Question 1

Billit Corporation 
Billit Corporation is a merchandising company. Selected account balances are listed below.
  Calculate the cost of goods sold for Billit Corporation.

Accepted Answer

A)  $221,000 
B)  $239,000 
C)  $241,000 
D)  $211,000 
A)  $221,000 
B)  $239,000 
C)  $241,000 
D)  $211,000

Question 2

Tickets4U.com 
Tickets4U.com uses a perpetual inventory system with a weighted average inventory costing method. The following information is available for the month of April.
 
- Refer to the information provided for Tickets4U.com. Calculate the cost of ending inventory on April 30th.

Accepted Answer

A)  $302 
B)  $312 
C)  $317 
D)  $327 
A)  $302 
B)  $312 
C)  $317 
D)  $327

Question 3

If the cost of an item of inventory is $60 and the market value is $50, the amount included in inventory according to the lower-of-cost-or-market is:

Accepted Answer

A)  $7. 
B)  $50. 
C)  $57. 
D)  $60. 
A)  $7. 
B)  $50. 
C)  $57. 
D)  $60.

Question 4

If the cost of an item of inventory is $50 and the market value is $57, the amount included in inventory according to the lower-of-cost-or-market is:

Accepted Answer

A)  $7. 
B)  $50. 
C)  $57. 
D)  $107. 
A)  $7. 
B)  $50. 
C)  $57. 
D)  $107.

Question 5

Portey Company 
Portey uses a perpetual inventory system and had the following inventory transactions for the month of June.
 
-  Refer to the information provided for Portey. If Portey uses the LIFO inventory costing method, cost of goods sold for the month of June is:

Accepted Answer

A)  $1,901.00. 
B)  $1,932.00. 
C)  $2,942.00. 
D)  $1,917.00. 
A)  $1,901.00. 
B)  $1,932.00. 
C)  $2,942.00. 
D)  $1,917.00.

Question 6

Shirey Co. 
Shirey uses a periodic inventory system. At the end of January, 20 units were on hand. The following additional information is available for the month of January.
 
- Refer to the information provided for Shirey. If Shirey uses the LIFO inventory costing method, how much is inventory on the balance sheet at the end of January?

Accepted Answer

A)  $40 
B)  $50 
C)  $58 
D)  $60 
A)  $40 
B)  $50 
C)  $58 
D)  $60

Question 7

Max's Tire Center Company 
Selected data from the financial statements of Max's Tire Center are provided below.
 
- Refer to the selected data provided for Max's Tire Center. What is Max's inventory turnover in 2012?

Accepted Answer

A)  The inventory turnover is 2.10 in 2012. 
B)  The inventory turnover is 2.61 in 2012. 
C)  The inventory turnover is 2.08 in 2012. 
D)  The inventory turnover is 2.38 in 2012. 
A)  The inventory turnover is 2.10 in 2012. 
B)  The inventory turnover is 2.61 in 2012. 
C)  The inventory turnover is 2.08 in 2012. 
D)  The inventory turnover is 2.38 in 2012.

Question 8

During a period of increasing purchase prices, which inventory costing method will yield the lowest cost of goods sold?

Accepted Answer

A)  Any method in which the company uses a periodic system. 
B)  FIFO 
C)  LIFO 
D)  Weighted average cost 
A)  Any method in which the company uses a periodic system. 
B)  FIFO 
C)  LIFO 
D)  Weighted average cost

Question 9

Portey Company 
Portey uses a perpetual inventory system and had the following inventory transactions for the month of June.
 
-  Refer to the information provided for Portey. If Portey uses the FIFO inventory costing method, cost of goods sold for the month of June is:

Accepted Answer

A)  $1,932.00. 
B)  $1,901.00. 
C)  $2,942.00. 
D)  $1,917.00. 
A)  $1,932.00. 
B)  $1,901.00. 
C)  $2,942.00. 
D)  $1,917.00.

Question 10

Geoffry Hesse Exports
The following data are available for one of the products sold by Geoffry Hesse Exports, which uses a perpetual inventory system.
   
-Refer to the information provided for Geoffry Hesse Exports. If the LIFO method of inventory costing is used, determine the following amounts:
 A) Cost of goods sold for the units sold on July 10 th?
B) Ending inventory on July 31 st?

Accepted Answer

The answer of Geoffry Hesse Exports
The following data are available...

Question 11

Harold's Five & Dime 
Harold's Five & Dime is a merchandising company that uses the periodic inventory system. Selected account balances are listed below.
  Calculate Harold's net purchases.

Accepted Answer

A)  $ 84,000 
B)  $ 90,000 
C)  $103,000 
D)  $117,000 
A)  $ 84,000 
B)  $ 90,000 
C)  $103,000 
D)  $117,000

Question 12

Silvermark Enterprises 
The following information is from Silvermark's 2012 accounting records.
 
- Refer to the information provided for Silvermark Enterprises. How much will Silvermark report as net purchases for 2012?

Accepted Answer

A)  $200,000 
B)  $209,000 
C)  $218,000 
D)  $201,600 
A)  $200,000 
B)  $209,000 
C)  $218,000 
D)  $201,600

Question 13

Ahi Corporation purchased merchandise on account from Yudder Inc. on December 12, 2012. On December 13, 2012, Ahi returned damaged merchandise to Yudder and was granted an adjustment on its account. Ahi uses the periodic inventory system. What effect does the merchandise return have on Ahi's accounting equation?

Accepted Answer

A)  Assets and equity decrease. 
B)  Assets and liabilities decrease. 
C)  Liabilities decrease and equity increases. 
D)  Liabilities and equity decrease. 
A)  Assets and equity decrease. 
B)  Assets and liabilities decrease. 
C)  Liabilities decrease and equity increases. 
D)  Liabilities and equity decrease.

Question 14

What effects on a retail store's accounting equation occur when the retail store pays a third-party carrier to transport inventory to its warehouse?

Accepted Answer

A)  No net effect. 
B)  Assets and equity increase. 
C)  Assets decrease and liabilities increase. 
D)  Equity decreases and liabilities increase. 
A)  No net effect. 
B)  Assets and equity increase. 
C)  Assets decrease and liabilities increase. 
D)  Equity decreases and liabilities increase.

Question 15

The following journal entry was included in the accounting records of Spica, Inc.   Based on this information, it is likely that Spica:

Accepted Answer

A)  purchased inventory for cash. 
B)  paid for inventory purchased on credit, and took advantage of a 1% purchase discount. 
C)  sold inventory for cash. 
D)  collected cash for inventory sold on credit, and recognized a 1% sales discount. 
A)  purchased inventory for cash. 
B)  paid for inventory purchased on credit, and took advantage of a 1% purchase discount. 
C)  sold inventory for cash. 
D)  collected cash for inventory sold on credit, and recognized a 1% sales discount.

Question 16

Which inventory costing method results in the highest inventory balance during a period of rising purchase prices?

Accepted Answer

A)  Weighted average cost 
B)  FIFO 
C)  LIFO 
D)  Both FIFO and LIFO result in the same inventory balance. 
A)  Weighted average cost 
B)  FIFO 
C)  LIFO 
D)  Both FIFO and LIFO result in the same inventory balance.

Question 17

Shelton Brothers, Inc. 
Shelton Brothers uses a periodic inventory system. It purchased merchandise from BXP on account Inc. on July 7, 2012, for $15,000. The credit terms were 1/10, n/30. Shelton paid the amount due on July 15.
-
Refer to the information provided for Shelton Brothers, Inc. What effect does recording the purchase of merchandise on July 7, 2012, have on Shelton's accounting equation?

Accepted Answer

A)  Assets and liabilities increase. 
B)  Liabilities increase and equity decreases. 
C)  Assets and equity increase. 
D)  Liabilities and equity decrease. 
A)  Assets and liabilities increase. 
B)  Liabilities increase and equity decreases. 
C)  Assets and equity increase. 
D)  Liabilities and equity decrease.

Question 18

Max's Tire Center Company 
Selected data from the financial statements of Max's Tire Center are provided below.
 
- Refer to the selected data provided for Max's Tire Center. Which of the following would result from a horizontal analysis of Max's income statement?

Accepted Answer

A)  Cost of sales increased by 9.09% during 2012. 
B)  Cost of sales increased by 11% during 2012. 
C)  Cost of sales is 30.76% of Net Sales in 2012. 
D)  Cost of sales more than double the inventory in 2012.. 
A)  Cost of sales increased by 9.09% during 2012. 
B)  Cost of sales increased by 11% during 2012. 
C)  Cost of sales is 30.76% of Net Sales in 2012. 
D)  Cost of sales more than double the inventory in 2012..

Question 19

Portey Company 
Portey uses a perpetual inventory system and had the following inventory transactions for the month of June.
 
- Refer to the information provided for Portey. If Portey uses the weighted average inventory costing method, ending inventory at June 30th is:

Accepted Answer

A)  $1,015.00. 
B)  $1,010.27. 
C)  $1,041.00. 
D)  $1,024.82. 
A)  $1,015.00. 
B)  $1,010.27. 
C)  $1,041.00. 
D)  $1,024.82.

Question 20

An overstatement error in the inventory account in the current period will result in an understatement of ____________________ in the next period.

Accepted Answer

The answer of An overstatement error in the inventory account...

Billit Corporation Billit Corporation is a merchandising company. Selected account balances are listed below. Calculate the cost of goods sold for Billit Corporation.

Tickets4U.com Tickets4U.com uses a perpetual inventory system with a weighted average inventory costing method. The following information is available for the month of April. - Refer to the information provided for Tickets4U.com. Calculate the cost of ending inventory on April 30th.

If the cost of an item of inventory is $60 and the market value is $50, the amount included in inventory according to the lower-of-cost-or-market is:

If the cost of an item of inventory is $50 and the market value is $57, the amount included in inventory according to the lower-of-cost-or-market is:

Portey Company Portey uses a perpetual inventory system and had the following inventory transactions for the month of June. - Refer to the information provided for Portey. If Portey uses the LIFO inventory costing method, cost of goods sold for the month of June is:

Max's Tire Center Company Selected data from the financial statements of Max's Tire Center are provided below. - Refer to the selected data provided for Max's Tire Center. What is Max's inventory turnover in 2012?

During a period of increasing purchase prices, which inventory costing method will yield the lowest cost of goods sold?

Portey Company Portey uses a perpetual inventory system and had the following inventory transactions for the month of June. - Refer to the information provided for Portey. If Portey uses the FIFO inventory costing method, cost of goods sold for the month of June is:

Harold's Five & Dime Harold's Five & Dime is a merchandising company that uses the periodic inventory system. Selected account balances are listed below. Calculate Harold's net purchases.

Silvermark Enterprises The following information is from Silvermark's 2012 accounting records. - Refer to the information provided for Silvermark Enterprises. How much will Silvermark report as net purchases for 2012?

What effects on a retail store's accounting equation occur when the retail store pays a third-party carrier to transport inventory to its warehouse?

The following journal entry was included in the accounting records of Spica, Inc. Based on this information, it is likely that Spica:

Which inventory costing method results in the highest inventory balance during a period of rising purchase prices?

Max's Tire Center Company Selected data from the financial statements of Max's Tire Center are provided below. - Refer to the selected data provided for Max's Tire Center. Which of the following would result from a horizontal analysis of Max's income statement?

Portey Company Portey uses a perpetual inventory system and had the following inventory transactions for the month of June. - Refer to the information provided for Portey. If Portey uses the weighted average inventory costing method, ending inventory at June 30th is:

An overstatement error in the inventory account in the current period will result in an understatement of ____________________ in the next period.

Financial Accounting

Corporate Financial Statements

Recording Accounting Transactions

Accrual Accounting and Adjusting Entries

Internal Control and Cash

Receivables

Fixed Assets and Intangible Assets

Liabilities

Stockholders Equity

Statement of Cash Flows

Financial Statement Analysis

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Exam 7: Inventory

Billit Corporation Billit Corporation is a merchandising company. Selected account balances are listed below. Calculate the cost of goods sold for Billit Corporation.

Tickets4U.com Tickets4U.com uses a perpetual inventory system with a weighted average inventory costing method. The following information is available for the month of April. - Refer to the information provided for Tickets4U.com. Calculate the cost of ending inventory on April 30th.

If the cost of an item of inventory is $60 and the market value is $50, the amount included in inventory according to the lower-of-cost-or-market is:

If the cost of an item of inventory is $50 and the market value is $57, the amount included in inventory according to the lower-of-cost-or-market is:

Portey Company Portey uses a perpetual inventory system and had the following inventory transactions for the month of June. - Refer to the information provided for Portey. If Portey uses the LIFO inventory costing method, cost of goods sold for the month of June is:

Max's Tire Center Company Selected data from the financial statements of Max's Tire Center are provided below. - Refer to the selected data provided for Max's Tire Center. What is Max's inventory turnover in 2012?

During a period of increasing purchase prices, which inventory costing method will yield the lowest cost of goods sold?

Portey Company Portey uses a perpetual inventory system and had the following inventory transactions for the month of June. - Refer to the information provided for Portey. If Portey uses the FIFO inventory costing method, cost of goods sold for the month of June is:

Harold's Five & Dime Harold's Five & Dime is a merchandising company that uses the periodic inventory system. Selected account balances are listed below. Calculate Harold's net purchases.

Silvermark Enterprises The following information is from Silvermark's 2012 accounting records. - Refer to the information provided for Silvermark Enterprises. How much will Silvermark report as net purchases for 2012?

What effects on a retail store's accounting equation occur when the retail store pays a third-party carrier to transport inventory to its warehouse?

The following journal entry was included in the accounting records of Spica, Inc. Based on this information, it is likely that Spica:

Which inventory costing method results in the highest inventory balance during a period of rising purchase prices?

Max's Tire Center Company Selected data from the financial statements of Max's Tire Center are provided below. - Refer to the selected data provided for Max's Tire Center. Which of the following would result from a horizontal analysis of Max's income statement?

Portey Company Portey uses a perpetual inventory system and had the following inventory transactions for the month of June. - Refer to the information provided for Portey. If Portey uses the weighted average inventory costing method, ending inventory at June 30th is:

An overstatement error in the inventory account in the current period will result in an understatement of ____________________ in the next period.

Financial Accounting

Corporate Financial Statements

Recording Accounting Transactions

Accrual Accounting and Adjusting Entries

Internal Control and Cash

Receivables

Fixed Assets and Intangible Assets

Liabilities

Stockholders Equity

Statement of Cash Flows

Financial Statement Analysis

Filters