Maple Corp.uses dollar-value LIFO.Certain information follows: $\begin{array}{rrr} &\text { Ending Inventory- }\\ \text { Year }&\text { Current Cost }&\text { Index }\\ 2010 & \$ 10,000 & 100 \\ 2011 & 11,845 & 103 \\ 2012 & 12,096 & 108 \\ 2013 & 13,090 & 110 \end{array}$ Compute the ending 2013 inventory.

A) $11, 900 B) $11, 985 C) $12, 006 D) $12, 090 A) $11, 900 B) $11, 985 C) $12, 006 D) $12, 090

La Brea, Inc.reported sales of $1, 200 in May and a gross profit of $370.The company had a May 1 inventory of 60 units that had a total cost of $300.May purchases and sales were as follows: $\begin{array}{llll} &\text { Purchases }&&\text { Sales }\\ \text { May } 7 & 40 \text { units } @ \$ 6 & \text { May } 2 & 20 \text { unit } \\ 10 & 20 \text { units } @ \$ 7 & 8 & 40 \text { units } \\ 18 & 40 \text { units } @ \$ 8 & 12 & 10 \text { unit } \\ 24 & 20 \text { units } @ \$ 9 & 20 & 20 \text { unit } \\ 28 & 20 \text { units } @ \$ 10 & 26 & 30 \text { unit } \end{array}$ La Brea, Inc., must use

A) LIFO perpetual B) FIFO C) weighted average D) LIFO periodic A) LIFO perpetual B) FIFO C) weighted average D) LIFO periodic

Stabler, Inc.provided the following inventory transaction summary for January: $\begin{array}{lr} 1/1&\text {Purchased 200 units@\$3.00 per unit. }\\ 1/15&\text { Sold 40 units. }\\ 1/21&\text {Purchased 300 units@\$5.00 per unit }\\ 1/31&\text { Purchased 40 urits@\$10.00 per unit}\\ \end{array}$ In addition, it has been determined that Stabler's inventory at the beginning of the month was $400.00 (200 units).What was Stabler's cost per unit at the end of January, using the moving average method?

A) $3.00 B) $2.00 C) $4.00 D) $6.00 A) $3.00 B) $2.00 C) $4.00 D) $6.00

On May 1, Mikrotek, Inc.had 120 units of a certain software package that cost $6 apiece.During May, the following purchases were made: $\begin{array}{ll} \text { May 7 } & 60 \text { units @ } \$ 9.00 \\ 15 & 80 \text { units } @ \$ 12.00 \\ 21 & 140 \text { units@ } \$ 10.50 \end{array}$ During May, 300 units were sold.If Mikrotek uses the weighted average method, the cost of ending inventory would be

A) $ 922.50 B) $2, 767.50 C) $ 937.50 D) $2, 182.50 A) $ 922.50 B) $2, 767.50 C) $ 937.50 D) $2, 182.50

On June 1, Corona Company had 40 units of inventory at a cost of $6 each.June purchases and sales were as follows: $\begin{array}{llll} &\text { Purchases }&&\text { Sales }\\ \text { June } 5 & 10 \text { units } @ \$ 8 & \text { June } 4 & 20 \text { unit } \\ 12 & 20 \text { units } @ \$ 10 & 20 & 12 \text { unit }\\ 25& 10 \text { units } \$ 16 \end{array}$ The cost of goods sold during June was $272.Corona must use:

A) FIFO B) LIFO perpetual C) weighted average D) LIFO periodic A) FIFO B) LIFO perpetual C) weighted average D) LIFO periodic

Exhibit 8-4 RK, Inc.had the following activity for an inventory item during June: $\begin{array}{lll}&&\text { Unit }\\&\text { Units }&\text { Cost }\\ \text { Beginning inventory } & 50 & \$ 10 \\ \text { Purchase (June 5) } & 10 & 16 \\ \text { Purchase (June 15) } & 30 & 14 \\ \text { Sale (June 20) } & 40 & \\ \text { Sale (June 25) } & 20 &\\ \text { Purchase (June 30) }&10& 20 \end{array}$ - Refer to Exhibit 8-4.Assuming RK uses a perpetual moving average cost flow assumption, ending inventory for June would be

A) $512 B) $560 C) $768 D) $720 A) $512 B) $560 C) $768 D) $720

Exhibit 8-3 Davilo Co.had the following inventory activity during April: $\begin{array}{lll} &&\text { Units }\\ & \text { Unit }&\text{cost}\\ \text { Beginning inventory } & 100 & \$ 8 \\ \text { Purchase (April 3) } & 60 & 12 \\ \text { Sale (April 10) } & 80 & \\ \text { Purchase (April 18) } & 50 & 15 \\ \text { Purchase (April 23) } & 80 & 18 \\ \text { Sale (April 28) } & 100 & \end{array}$ - Refer to Exhibit 8-3.Assuming Davilo uses a periodic FIFO cost flow assumption, ending inventory at April 30 would be

A) $ 880 B) $ 920 C) $1, 090 D) $1, 890 A) $ 880 B) $ 920 C) $1, 090 D) $1, 890

Exam 8: Inventories: Cost Measurement and Flow Assumptions

Exhibit 8-1 Walters Co.purchased raw materials with a catalog price of $70, 000 on March 2, 2010.Credit terms of 4/20, n/60 applied.If Walters pays for the purchase on March 18, 2010, calculate what amount is recorded for inventory on March 2, 2010, using the method given. - Refer to Exhibit 8-1.Walters uses a perpetual inventory system and the gross price method.

(Multiple Choice)

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Question 61

Maple Corp.uses dollar-value LIFO.Certain information follows: Ending Inventory- Year Current Cost Index 2010 \ 10,000 100 2011 11,845 103 2012 12,096 108 2013 13,090 110 Compute the ending 2013 inventory.

(Multiple Choice)

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Question 62

La Brea, Inc.reported sales of $1, 200 in May and a gross profit of $370.The company had a May 1 inventory of 60 units that had a total cost of $300.May purchases and sales were as follows: Purchases Sales May 7 40 units @\ 6 May 2 20 unit 10 20 units @\ 7 8 40 units 18 40 units @\ 8 12 10 unit 24 20 units @\ 9 20 20 unit 28 20 units @\ 10 26 30 unit La Brea, Inc., must use

(Multiple Choice)

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Question 63

Stabler, Inc.provided the following inventory transaction summary for January: 1/1 Purchased 200 units@ \3 .00 per unit. 1/15 Sold 40 units. 1/21 Purchased 300 units@ \5 .00 per unit 1/31 Purchased 40 urits@ \1 0.00 per unit In addition, it has been determined that Stabler's inventory at the beginning of the month was $400.00 (200 units).What was Stabler's cost per unit at the end of January, using the moving average method?

(Multiple Choice)

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Question 64

The information below is provided for two inventory items held by Haskell, Inc.: The company uses double-extension dollar-value LIFO with only one pool. Required: Calculate the December 31, 2010 ending inventory for Haskell using dollar-value LIFO.Round to the nearest dollar or to the nearest hundredth for decimals.

(Essay)

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Question 65

On May 1, Mikrotek, Inc.had 120 units of a certain software package that cost $6 apiece.During May, the following purchases were made: May 7 60 units @ \ 9.00 15 80 units @\ 12.00 21 140 units@ \ 10.50 During May, 300 units were sold.If Mikrotek uses the weighted average method, the cost of ending inventory would be

(Multiple Choice)

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Question 66

On June 1, Corona Company had 40 units of inventory at a cost of $6 each.June purchases and sales were as follows: Purchases Sales June 5 10 units @\ 8 June 4 20 unit 12 20 units @\ 10 20 12 unit 25 10 units \ 16 The cost of goods sold during June was $272.Corona must use:

(Multiple Choice)

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Question 67

Trigger Corp.began business in 2010.On December 31, 2010, Trigger's single pool of inventory was valued at $300, 000, using the dollar-value LIFO inventory method.On December 31, 2011, the value of Trigger's inventory at current costs was $450, 000.The 2011 year-end cost index was 120.What was the value of Trigger's inventory at the end of 2011, using the dollar-value LIFO method?

(Multiple Choice)

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Question 68

IFRS do not allow the use of LIFO because it

(Multiple Choice)

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Question 69

Goods acquired for resale.

consignee

Goods manufactured for resale.

consignor

Maintains an up-to-date cost of goods sold account balance.

finished goods inventory

Correct Answer:

Verified

Goods acquired for resale.

Goods manufactured for resale.

Maintains an up-to-date cost of goods sold account balance.

Establishes ending inventory by performing a physical count.

Legal title to the inventory transfers to the buyer when the goods leave the seller's place of business.

Legal title to the inventory passes to the buyer when the goods reach the buyer's place of business.

The company that relinquishes possession to the goods so that they may be sold, while retaining ownership of the goods until they are sold.

The company that takes possession of the goods, but not legal title, in order to sell them.

Records the discount only if it is taken.

Records the discount only if it is not taken.

(Matching)

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Question 70

Which of the following inventory cost flow assumptions produces the same ending inventory values under both the periodic and perpetual systems?

(Multiple Choice)

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Question 71

Which one of the following statements is true?

(Multiple Choice)

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Question 72

Which inventory cost flow assumption is not allowed for financial reporting in many foreign countries?

(Multiple Choice)

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Question 73

Exhibit 8-4 RK, Inc.had the following activity for an inventory item during June: Unit Units Cost Beginning inventory 50 \ 10 Purchase (June 5) 10 16 Purchase (June 15) 30 14 Sale (June 20) 40 Sale (June 25) 20 Purchase (June 30) 10 20 - Refer to Exhibit 8-4.Assuming RK uses a perpetual moving average cost flow assumption, ending inventory for June would be

(Multiple Choice)

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Question 74

Exhibit 8-3 Davilo Co.had the following inventory activity during April: Units Unit cost Beginning inventory 100 \ 8 Purchase (April 3) 60 12 Sale (April 10) 80 Purchase (April 18) 50 15 Purchase (April 23) 80 18 Sale (April 28) 100 - Refer to Exhibit 8-3.Assuming Davilo uses a periodic FIFO cost flow assumption, ending inventory at April 30 would be

(Multiple Choice)

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Question 75

A retail firm would normally use an inventory account titled

(Multiple Choice)

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Question 76

Management's choice to use LIFO or FIFO can make a financial analyst's efforts to compare companies difficult.The financial analyst's job is made easier because of

(Multiple Choice)

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Question 77

There are many differences between inventory cost flow assumptions.Listed below is a series of descriptive statements. Required: For each statement, indicate if it applies to LIFO or FIFO or both by placing an "X" in the appropriate column(s).

(Essay)

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Question 78

Which one of the following types of costs is excluded from the cost of inventory that is routinely manufactured?

(Multiple Choice)

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Question 79

Which one of the following statements is false?

(Multiple Choice)

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Question 80

Maple Corp.uses dollar-value LIFO.Certain information follows: Ending Inventory- Year Current Cost Index 2010 \ 10,000 100 2011 11,845 103 2012 12,096 108 2013 13,090 110 Compute the ending 2013 inventory.

On June 1, Corona Company had 40 units of inventory at a cost of $6 each.June purchases and sales were as follows: Purchases Sales June 5 10 units @\ 8 June 4 20 unit 12 20 units @\ 10 20 12 unit 25 10 units \ 16 The cost of goods sold during June was $272.Corona must use:

IFRS do not allow the use of LIFO because it

Which of the following inventory cost flow assumptions produces the same ending inventory values under both the periodic and perpetual systems?

Which one of the following statements is true?

Which inventory cost flow assumption is not allowed for financial reporting in many foreign countries?

A retail firm would normally use an inventory account titled

Management's choice to use LIFO or FIFO can make a financial analyst's efforts to compare companies difficult.The financial analyst's job is made easier because of

There are many differences between inventory cost flow assumptions.Listed below is a series of descriptive statements. Required: For each statement, indicate if it applies to LIFO or FIFO or both by placing an "X" in the appropriate column(s).

Which one of the following types of costs is excluded from the cost of inventory that is routinely manufactured?

Which one of the following statements is false?

The Environment of Financial Reporting

Financial Reporting: Its Conceptual Framework

Review of a Companys Accounting System

The Balance Sheet and the Statement of Changes in Stockholders Equity

The Income Statement and the Statement of Cash Flows

Additional Aspects of Financial Reporting and Financial Analysis

Cash and Receivables

Inventories: Special Valuation Issues

Property, Plant, and Equipment: Acquisition and Disposal

Depreciation and Depletion

Intangibles

Current Liabilities and Contingencies

Long-Term Liabilities and Receivables

Investments

Contributed Capital

Earnings Per Share and Retained Earnings

Income Recognition and Measurement of Net Assets

Accounting for Income Taxes

Accounting for Postemployment Benefits

Accounting for Leases

The Statement of Cash Flows

Accounting for Changes and Errors

Time Value of Money Module

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