Question 5 (18 marks) Company w Company 51.000.000 M COGS Gross Margin MM wth w $605,000 $395.000 $1,000,000 Operating Expenses Operating Profit $160,000 $235.000 Opening inventory Purchases Freight in Cost of Goods Available for sale Less Ending inventory COGS Gross Margin 5155.000 5625,000 $30,000 5810,000 $205.000 S605,000 5395,000 Other Expenses $90,000 CON TRADING CON Net Income $145.000 Operating Expenses Operating Profit $160,000 $235.000 Other Expenses $90,000 Neuincome $145.000 Requirements 1) Identify the inventory costing method used by Company A and B 2) Prepare Closing entries for both Company A and B 55 Question 6 (20 marks) At the beginning of 2020, Fly by Night Airways purchased a used Boeing jet at a cost of $60,000,000. Fly by Night expects the plane to remain useful for eight years (6,000,000 miles) and to have a residual value of $8,000,000. The plane is expected to be flown 750,000, 800,000 and 900,000 miles respectively in years 2020 2021 and 2022