Question 1

What is the cost-to-retail ratio using the retail method?
2.What is the estimated cost of the ending inventory?

Accepted Answer

The answer of What is the cost-to-retail ratio using the...

Question 2

On December 31 of the current year,Plunkett Company reported an ending inventory balance of $215,000.The following additional information is also available: ▪ Plunkett sold and shipped goods costing $38,000 to Savannah Enterprises on December 28 with shipping terms of FOB shipping point.The goods were not included in the ending inventory amount of $215,000.
▪ Plunkett purchased goods costing $44,000 on December 29.The goods were shipped FOB destination and were received by Plunkett on January 2 of the following year.The shipment was a rush order that was supposed to arrive by December 31.These goods were included in the ending inventory balance of $215,000.
▪ Plunkett's ending inventory balance of $215,000 included $15,000 of goods being held on consignment from Carole Company.(Plunkett Company is the consignee. )
▪ Plunkett's ending inventory balance of $215,000 did not include goods costing $95,000 that were shipped to Plunkett on December 27 with shipping terms of FOB destination and were still in transit at year-end.
Based on the above information,the amount that Plunkett should report in ending inventory on December 31 is:

Accepted Answer

A) $194,000 
B) $209,000 
C) $200,000 
D) $171,000 
E) $156,000 
A) $194,000 
B) $209,000 
C) $200,000 
D) $171,000 
E) $156,000 E

Question 3

A company has the following per unit original costs and replacement costs for its inventory.LCM is applied to individual items. Part A: 50 units with a cost of $5,and replacement cost of $4.50
Part B: 75 units with a cost of $6,and replacement cost of $6.50
Part C: 160 units with a cost of $3,and replacement cost of $2.50
Under the lower of cost or market method,the total value of this company's ending inventory is:

Accepted Answer

A) $1,180.00. 
B) $1,075.00. 
C) $1,112.50. 
D) $1,217.50. 
E) $1,137.50. 
A) $1,180.00. 
B) $1,075.00. 
C) $1,112.50. 
D) $1,217.50. 
E) $1,137.50. C

Question 4

Merchandise inventory includes:

Accepted Answer

A) All goods owned by a company and held for sale. 
B) All goods in transit. 
C) All goods on consignment. 
D) Only damaged goods. 
E) Only non-damaged goods. 
A) All goods owned by a company and held for sale. 
B) All goods in transit. 
C) All goods on consignment. 
D) Only damaged goods. 
E) Only non-damaged goods.

Question 5

The Community Store reported the following amounts on their financial statements for Year 1,Year 2,and Year 3:   It was discovered early in Year 4 that the ending inventory on December 31,Year 1 was overstated by $6,000,and the ending inventory on December 31,Year 2 was understated by $2,500.The ending inventory on December 31,Year 3 was correct.Ignoring income taxes determine the correct amounts of cost of goods sold,net income,total current assets,and equity for each of the years Year 1,Year 2,and Year 3.

Accepted Answer

The answer of The Community Store reported the following amounts...

Question 6

Goods that are in transit and were shipped FOB shipping point should be included in the inventory records of the _______________________.

Accepted Answer

The answer of Goods that are in transit and were...

Question 7

A company reported the current month purchase and sales data for its only product and uses the perpetual inventory system.Determine the cost assigned to ending inventory and cost of goods sold using LIFO.

Accepted Answer

The answer of A company reported the current month purchase...

Question 8

A company's inventory records indicate the following data for the month of January:   If the company uses the last-in,first-out perpetual inventory system,what is the amount of cost of goods sold for January?

Accepted Answer

The answer of A company's inventory records indicate the following...

Question 9

Using the information given below for a company that uses a perpetual inventory system,calculate the ending inventory using weighted average.

Accepted Answer

@#IMG-DLM& *$1,480/140 units =

Question 10

A company uses the periodic inventory system and had the following activity during the current monthly period.   Using the weighted-average inventory method,the company's ending inventory would be:

Accepted Answer

A) $2,000 
B) $2,200 
C) $2,250 
D) $2,400 
E) $4,400 
A) $2,000 
B) $2,200 
C) $2,250 
D) $2,400 
E) $4,400

Question 11

Which of the following prescribes the use of the less optimistic amount when more than one estimate of an amount to be received or paid exists and the estimates are about equally likely?

Accepted Answer

A) Full disclosure principle. 
B) Consistency concept. 
C) FIFO inventory valuation method. 
D) Conservatism constraint. 
E) Matching principle. 
A) Full disclosure principle. 
B) Consistency concept. 
C) FIFO inventory valuation method. 
D) Conservatism constraint. 
E) Matching principle.

Question 12

The consistency concept:

Accepted Answer

A) Prescribes a company use the same accounting method of inventory valuation,an exception being when a change from one method to another will improve its financial reporting. 
B) Requires a company to use one method of inventory valuation exclusively. 
C) Requires that all companies in the same industry use the same accounting methods of inventory valuation. 
D) Is also called the full disclosure principle. 
E) Is also called the matching principle. 
A) Prescribes a company use the same accounting method of inventory valuation,an exception being when a change from one method to another will improve its financial reporting. 
B) Requires a company to use one method of inventory valuation exclusively. 
C) Requires that all companies in the same industry use the same accounting methods of inventory valuation. 
D) Is also called the full disclosure principle. 
E) Is also called the matching principle.

Question 13

A company had the following purchases during the current year:   On December 31,there were 26 units remaining in ending inventory.These 26 units consisted of 2 from January,4 from February,6 from May,4 from September,and 10 from November.Using the specific identification method,what is the cost of the ending inventory?

Accepted Answer

A) $3,500. 
B) $3,800. 
C) $3,960. 
D) $3,280. 
E) $3,640. 
A) $3,500. 
B) $3,800. 
C) $3,960. 
D) $3,280. 
E) $3,640.

Question 14

Salmone Company reported the following purchases and sales for its only product.Salmone uses a perpetual inventory system.Determine the cost assigned to cost of goods sold using LIFO.

Accepted Answer

A) $2,260 
B) $3,180 
C) $1,860 
D) $3,580 
E) $2,100 
A) $2,260 
B) $3,180 
C) $1,860 
D) $3,580 
E) $2,100

Question 15

A company made the following merchandise purchases and sales during the month of May:   There was no beginning inventory.If the company uses the FIFO periodic inventory method,what would be the cost of the ending inventory?

Accepted Answer

@#IMG-DLM& Cost of ending inve

Question 16

A company reports the following information regarding its inventory. Beginning inventory: cost is $80,000;retail is $130,000
Net purchases: cost is $65,000;retail is $120,000
Sales at retail: $145,000
The year-end inventory shows $135,000 worth of merchandise available at retail prices.What is the cost of the ending inventory calculated using the retail inventory method?

Accepted Answer

A) $135,000. 
B) $73,125. 
C) $78,300. 
D) $72,900. 
E) $105,000. 
A) $135,000. 
B) $73,125. 
C) $78,300. 
D) $72,900. 
E) $105,000.

Question 17

When purchase costs regularly rise,the ___________________ method of inventory valuation yields the lowest gross profit and net income,providing a tax advantage.

Accepted Answer

Last in,fi

Question 18

Which of the following inventory costing methods will always result in the same values for ending inventory and cost of goods sold regardless of whether a perpetual or periodic inventory system is used?

Accepted Answer

A) FIFO and LIFO 
B) LIFO and weighted-average cost 
C) Specific identification and FIFO 
D) FIFO and weighted-average cost 
E) LIFO and specific identification 
A) FIFO and LIFO 
B) LIFO and weighted-average cost 
C) Specific identification and FIFO 
D) FIFO and weighted-average cost 
E) LIFO and specific identification

Question 19

When purchase costs regularly rise,the ___________________ method of inventory valuation yields the highest gross profit and net income.

Accepted Answer

First in,f

Question 20

Goods that are in transit and were shipped FOB destination should be included in the inventory records of the _______________________.

Accepted Answer

The answer of Goods that are in transit and were...

Exam 6: Inventories and Cost of Sales

What is the cost-to-retail ratio using the retail method? 2.What is the estimated cost of the ending inventory?

Merchandise inventory includes:

Goods that are in transit and were shipped FOB shipping point should be included in the inventory records of the _______________________.

A company reported the current month purchase and sales data for its only product and uses the perpetual inventory system.Determine the cost assigned to ending inventory and cost of goods sold using LIFO.

A company's inventory records indicate the following data for the month of January: If the company uses the last-in,first-out perpetual inventory system,what is the amount of cost of goods sold for January?

Using the information given below for a company that uses a perpetual inventory system,calculate the ending inventory using weighted average.

A company uses the periodic inventory system and had the following activity during the current monthly period. Using the weighted-average inventory method,the company's ending inventory would be:

Which of the following prescribes the use of the less optimistic amount when more than one estimate of an amount to be received or paid exists and the estimates are about equally likely?

The consistency concept:

Salmone Company reported the following purchases and sales for its only product.Salmone uses a perpetual inventory system.Determine the cost assigned to cost of goods sold using LIFO.

A company made the following merchandise purchases and sales during the month of May: There was no beginning inventory.If the company uses the FIFO periodic inventory method,what would be the cost of the ending inventory?

When purchase costs regularly rise,the ___________________ method of inventory valuation yields the lowest gross profit and net income,providing a tax advantage.

Which of the following inventory costing methods will always result in the same values for ending inventory and cost of goods sold regardless of whether a perpetual or periodic inventory system is used?

When purchase costs regularly rise,the ___________________ method of inventory valuation yields the highest gross profit and net income.

Goods that are in transit and were shipped FOB destination should be included in the inventory records of the _______________________.

Accounting in Business

Analyzing and Recording Transactions

Adjusting Accounts and Preparing Financial Statements

Completing the Accounting Cycle

Accounting for Merchandising Operations

Accounting Information Systems

Cash and Internal Controls

Accounting for Receivables

Plant Assets, Natural Resources, and Intangibles

Current Liabilities and Payroll Accounting

Accounting for Partnerships

Accounting for Corporations

Long-Term Liabilities

Investments and International Operations

Reporting the Statement of Cash Flows

Analysis of Financial Statements

Managerial Accounting Concepts and Principles

Job Order Cost Accounting

Process Cost Accounting

Cost-Volume-Profit Analysis

Master Budgets and Planning

Flexible Budgets and Standard Costs

Performance Measurement and Responsibility Accounting

Capital Budgeting and Managerial Decisions

Appendix B: Time Value of Money

Appendix C: Activity-Based Costing

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