Required information E7-7 Analyzing and Interpreting the Financial Statement Effects of LIFO and FIFO LO7-2, 7-3 (The following information applies to the questions displayed below.] Broadhead Company uses a periodic inventory system. At the end of the annual accounting period, December 31 of the current year, the accounting records provided the following information for product 2: Unit Units Cost 2,850 Inventory, December 31, prior year For the current year Purchase, April 11 Purchase, June 1 Sales ($56 each) Operating expenses (excluding income tax expense) $12 8,920 7,870 10,890 10 15 $188,000 E7-7 Part 1 Required: 1. Prepare a separate income statement through pretax income that details cost of goods sold for (a) Case A: FIFO and (b) Case B: LIFO BROADHEAD COMPANY Income Statement For the Year Ended December 31, current year Case A Case B LIFO FIFO Sales revenue Cost of goods sold: 2,850 Beginning inventory Purchases Purchases 2,850 Goods available for sale 0 Ending inventory Cost of goods sold Gross profit Operating expenses