P7-3 (Algo) Evaluating Four Alternative Inventory Methods Based on Income and Cash Flow LO7-2, 7-3 (The following information applies to the questions displayed below.] At the end of January of the current year, the records of Donner Company showed the following for a particular item that sold at $15.00 per unit: Transactions Inventory, January 1 Purchase, January 12 Purchase, January 26 Sale Sale Units 500 620 100 (380) (210) Amount $2,500 4,340 900 P7-3 Part 1 Required: 1a. Assuming the use of a periodic inventory system, compute Cost of Goods Sold under each method of inventory: average cost, FIFO, LIFO, and specific identification. For specific identification, assume that the first sale was selected from the beginning inventory and the second sale was selected from the January 12 purchase. 1b. Assuming the use of a periodic inventory system, prepare a partial income statement under each method of inventory: (a) average cost, (b) FIFO, (C) LIFO, and (d) specific identification. For specific identification, assume that the first sale was selected from the beginning inventory and the second sale was selected from the January 12 purchase. Complete this question by entering your answers in the tabs below. LIFO Cost of Goods Available for Sale Cost of Goods Sold # of Units Cost per Unit Cost of Goods Available for Sale # of Units Sold Cost per Unit Cost of Goods Sold Beginning inventory 500 $ 5.00 $ 2,500 0 Purchases: January 12 620 7.00 $ 4,340.00 480 X 7.00 $ 3,360 January 26 100 9.00 900.00 110 x 9.00 $ 990 Total 1,220 $ 7,740 590 $ 4,350 Specific Identification Cost of Goods Available for Sale Cost of Goods Sold Cost # of Units per Unit Cost of Goods Available for Sale # of Units Sold Cost per Unit Cost of Goods Sold Beginning inventory 500 $ 5.00 $ 2,500 390 X 5.00 $ 1,950 Purchases: January 12 620 7.00 $ 4,340 200 X 7.00 $ 1,400 January 26 100 9.00 $ 900 0 Total 1,220 $ 7,740 590 $ 3,350 Req 1A Req 1B Assuming the use of a periodic inventory system, prepare a partial income statement under each method of inventory: (a) average cost, (b) FIFO, (C) LIFO, and (d) specific identification. For specific identification, assume that the first sale was selected from the beginning inventory and the second sale was selected from the January 12 purchase. DONNER COMPANY Partial Income Statement For the Month Ended January 31, Current Year (a) (b) (c) Average FIFO LIFO Cost $ 8,850 $ 8,850 $ 8,850 $ 3,741 $ 3,130 $ 4,244 $ 5,109 $ 5,720 $ 4,606 (d) Specific Identification $ 8,850 Sales revenue Cost of goods sold Gross profit 3,306 X 5,544 X $