Scoresby Inc. uses a perpetual inventory system. At December 31, 2021, the company's accounting records provided the following information for Product B: Transactions a. Inventory, December 31, 2020 For the year 2021: b. Purchase, March 5 Units 7,000 Unit Cost $ 8 19,000 9 10,000 e. Sale, November 20 ($31 each) 8,000 16,000 11 f. Operating expenses (excluding income tax expense), $500,000 c. Sale, June 15 ($29 each) d. Purchase, September 19 Required: 1. Prepare a statement of earnings for 2021 through pretax earnings, showing the detailed computation of cost of sales for two cases: a. Case A-FIFO b. Case B-Weighted average (Round intermediate calculations to 2 decimal place.) Cost of sales: SCORESBY INC. Statement of Earnings For the Year Ended December 31, 2021 Case A FIFO 0 0 0 Case B Weighted Average 0 0 0 $ 0 0 2. Compare the two cases with regard to the pretax earnings and the ending inventory amounts. Comparison of Amounts Pretax earnings Difference Ending Inventory Difference Case A FIFO Case B Weighted Average 3. Which inventory costing method may be preferred for income tax purposes? Weighted average FIFO 4. Prepare journal entries to record transactions (b) through (e), assuming that all sales and purchase transactions are on account and that Scoresby uses FIFO for inventory costing. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.) 4. Prepare journal entries to record transactions (b) through (e), assuming that all sales and purchase transactions are on account and that Scoresby uses FIFO for inventory costing. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.) View transaction list Journal entry worksheet 1 2 3 4 5 6 Record the entry for purchase of inventory. Note: Enter debits before credits. Transaction b. General Journal Debit Credit Record entry Clear entry View general journal