Submit test 10 point possible Huge-Navy Surplus Ltd. began October 2020 with 66 tents that cost $20 each. During the month, Huge-Navy Surplus made the following purchases at cost B (Click the icon to view the purchases.) Huge-Navy Surplus sold 304 tents (134 tents on October 22 and 170 tents on October 30), and at October 31 the ending inventory consists of 51 tents. The sale price of each tent was $53 Requirements CERE Requirement 1. Determine the cost of goods sold and ending inventory amounts for October under (a) weighted average cost and (b) FIFO cost Round weighted average cost per unit to four decimal places and round all other amounts to the nearest dollar. (Assume a perpetual inventory control system is used.) Weighted- Average Cost FIFO Ending inventory Cost of goods sold Requirement 2. Explain why cost of goods sold is highest under weighted average cost Be specific (Assume a perpetual inventory control system is used.) 7 and (b) weighted average cost includes the cost of the When costs are rising these latest inventory costs are the highest Weighted average cost results in the highest cost of goods sold because (a) the cost of tents is and that makes cost of goods sold the under weighted average cost Requirement 3. Prepare Huge-Navy Surplus's income statement for October 2020. Report gross profit Operating expenses totalled $4,500. Huge-Navy Surplus uses the weighted average costing for inventory. The income tax rate is 40% (Round income tax expense to the nearest whole dollar.) Huge-Navy Surplus Ltd. Income Statement For the Month Ended October 31, 2020 Time Remaining: 01:23:12 Next Purchases October 4 97 tents @ $ 22 = $ 2,134 19 155 tents @ 24 3,720 25 37 tents @ 25 = 925 x Requirements 1. Determine the cost of goods sold and ending inventory amounts for October under (a) weighted-average cost and (b) FIFO cost assuming the perpetual system is used. Round weighted average cost per unit to four decimal places, and round all other amounts to the nearest dollar 2. Explain why cost of goods sold is highest under weighted-average cost. Be specific 3. Prepare Huge-Navy Surplus's income statement for October 2020. Report gross profit. Operating expenses totalled $4,500. Huge-Navy Surplus uses the weighted average costing for inventory. The income tax rate is 40%