Howsham Ltd. Reports the following for the month of June. Instructions a. Calculate the cost of the ending inventory and the cost of goods sold for (1) FIFO and (2) movingaverage cost, using a perpetual inventory system. Assume a sale of 400 units occurred on June 15 for a selling price of $8 and a sale of 440 units on June 27 for $9. b. Why is the average unit cost not $6[($5+$6+$7)/3=$6] ? FIFO Assume a sale of 400 units oecurred on June 15 for a selling price of $8 and a sale of 440 units on June 27 for $9. Moving Average b. Why is the average unit cost not $6[($5+$6+$7)/3=$6] ? Ans: The simple average would be [(5+6+7)3)] or 6. However, the movingaverage cost method uses a weighted-average unit cost that changes each time a purchase is made rather than a simple average