Nicholas Industries had the following inventory transactions occur during 2014: $$\begin{array}{llcc}& & \text{ Units }& \text{ Cost/unit }\\ 2/1/16& \text{ Purchase }& 54& \$45\\ 3/14/16& \text{ Purchase }& 93& \$47\\ 5/1/16& \text{ Purchase }& 66& \$49\end{array}$$ The company sold 140 units at $65 each and has a tax rate of 30%. Assuming that a periodic inventory system is used what is the company's gross profit using FIFO? (rounded to whole dollars)

A) $2388
B) $2628
C) $6472
D) $6712

We need to calculate the cost of goods sold (COGS) first using the FIFO method.

Beginning inventory (100 units at $60) = $6,000
Purchase on Jan 12 (200 units at $62) = $12,400
Purchase on May 1 (300 units at $64) = $19,200
Total cost of goods available for sale = $37,600

Since we sold 140 units, we need to take the cost of the first 140 units from the available cost of goods.

Cost of goods sold (140 units at $60 + 62*40) = $9,100

Now we can calculate the gross profit:

Revenue (140 units at $65) = $9,100
Cost of goods sold = $6,100
Gross profit = $3,000

But we need to apply the tax rate of 30% to calculate the net income:

Net income = $3,000 - (30% * $3,000) = $2,100

Therefore, the answer is B) $2628.