Exam 6: Inventories

The following information was available for Pete Company at December 31, 2018: beginning inventory $90,000; ending inventory $70,000; cost of goods sold $984,000; and sales $1,350,000. Pete's days in inventory in 2018 was

Effie Company uses a periodic inventory system. Details for the inventory account for the month of January, 2018 are as follows: An end of the month (1/31/18) inventory showed that 160 units were on hand. If the company uses LIFO, what is the value of the ending inventory?

Manufacturers usually classify inventory into all the following general categories except

The selection of an appropriate inventory cost flow assumption for an individual company is made by

The factor which determines whether or not goods should be included in a physical count of inventory is

The following accounts are included in the ledger of Wainwright Company: Advertising expense Freight-in Inventory Purchases Purchase returns and allowances Sales revenue Sales returns and allowances Which of the accounts would be included in calculating cost of goods sold?

Beginning inventory plus the cost of goods purchased equals

GAAP's definition for inventory and provision of guidelines for inventory accounting, as compared to IFRS are: IFRS:

Eneri Company's inventory records show the following data: A physical inventory on December 31 shows 4,000 units on hand. Eneri sells the units for $13 each. The company has an effective tax rate of 20%. Eneri uses the periodic inventory method. What is the cost of goods available for sale?

Goods in transit should be included in the inventory of the buyer when the

Othello Company understated its inventory by $20,000 at December 31, 2017. It did not correct the error in 2017 or 2018. As a result, Othello's stockholder's equity was:

Which costing method cannot be used to determine the cost of inventory items before lower-of-cost-or-net realizable value is applied?

Under the retail inventory method, the estimated cost of ending inventory is computed by multiplying the cost-to-retail ratio by

A company just starting business made the following four inventory purchases in June: A physical count of merchandise inventory on June 30 reveals that there are 250 units on hand. Using the LIFO inventory method, the value of the ending inventory on June 30 is

The manager of Brick Company is given a bonus based on income before income taxes. Net income, after taxes, is $11,200 for FIFO and $9,800 for LIFO. The tax rate is 30%. The bonus rate is 20%. How much higher is the manager's bonus if FIFO is adopted instead of LIFO?

Which of the following should be included in the physical inventory of a company?

The controller of Alt Company is applying the lower-of-cost-or-net realizable value basis of valuing its ending inventory. The following information is available: Instructions Compute the value of the ending inventory by applying the lower-of-cost-or-net realizable value basis.

Under the FIFO method, the costs of the earliest units purchased are the first charged to cost of goods sold.

Queen Company is in the electronics industry and the price it pays for inventory is decreasing. Instructions Indicate which inventory method will: a. provide the highest ending inventory. b. provide the highest cost of goods sold. c. result in the highest net income. d. result in the lowest income tax expense. e. produce the most stable earnings over several years.

If a company uses the FIFO cost flow assumption, the cost of goods sold for the period will be the same under a perpetual or periodic inventory system.