Total 30 Marks b. Mr. Luis Rodriguez is the financial manager of Hull pic, a UK company which is located in the east of London Hull Plc has the following inventory transactions: Day 1 Opening invenilory nil Day 2 Purchased 50 units at E15 per unit Day 3 Sold 20 units at 35 per unit Day 4 Purchased to units at 17 per unit Day 5 Purchased 80 units at 30 per unit Day 5 Sold 30 unts at 40 per unit You Are Required To: Apply the Average costing method to each transaction and calculate the desing value of inventory. 16 Marks) ) Prepare the report to critically evaluate the LIFO and FIFO inventory valuation methods and advise which method is better. In addition, explain which method Haple should use to remain IAS 2 compliant (10 Marks) iii) The Financial Manager of Hul Pic reeds your advice on IAS 38 You are required to explain wtry it is necessary to distinguish between research and development expenditure and how this distinction affects the accounting treatment (8 Marks) ARSA C iv) Following the financial manager's request, you need to explain the criteria that need to be satisfied before expenditure can be recognised in the balance sheet as intangible assets. Also explain how the criteria is applied to the recognition of separately purchased intangible assets, intangible assets acquired in a business combination and interally generated intangbie assets. In your discussion you are required to discuss IAS 38. (8 Marks) The Hull ple decides to adopt straight-ine depreciation on production equipment. The straight-line depreciation is charged in periods of operation, but if the production equpment is not in active use then no depreciation is charged. The financial managers of Hilplc justly this on the grounds that the economic benefits of the inactive production equipment we not being consumed. Some equipment can remain inactive for many years, although money is spent maintaining them during these periods. The financial manager requires advice as to whether this depreciation policy is in accordance with IAS 16 Property Plant and Equipment (& Marks)