Evaluating the choice among three alternative inventory methods based on cash flow effects lo7-2, 7-3following is partial information for the income statement of audio solutions company under three different inventory costing methods, assuming the use of a periodic inventory system: required: 1. compute cost of goods sold under the fifo, lifo, and average cost inventory costing methods. (do not round intermediate calculations.)cogsbeg inventory (400 units @ $28)purchases (475 units @35)goods availableending inventory (525)cogs2. prepare an income statement through pretax income for each method. sales, 350 units; unit sales price, $50; expenses, $1,700need preparing income statement3. rank the three methods in order of income taxes paid (favorable cash flow).

Ardmore farm and seed has an inventory dilemma. they have been selling a brand of very popular insect spray for the past year. they have never really analyzed the costs incurred from ordering and holding the inventory and currently fave a large stock of the insecticide in the warehouse. they estimate that it costs $25 to place an order, and it costs $0.25 per gallon to hold the spray. the annual requirements total 80,000 gallons for a 365 day year.a. assuming that 10,000 gallons are ordered each time an order is placed, estimate the annual inventory costs.b. calculate the eoq.c. given the eoq calculated in part b., how many orders should be placed and what is the average inventory balance? d. if it takes seven days to receive an order from suppliers, at what inventory level should ardmore place another order?