Question 1

Neighborly Industries has the following inventory information.   Assuming that a periodic inventory system is used, what is the amount allocated to ending inventory on a FIFO basis?

Accepted Answer

A)  $10,992 
B)  $11,022 
C)  $23,088 
D)  $23,118 
A)  $10,992 
B)  $11,022 
C)  $23,088 
D)  $23,118

Question 2

Which one of the following inventory methods is often impractical to use?

Accepted Answer

A)  Specific identification 
B)  Average cost 
C)  FIFO 
D)  All of these answer choices are practical to use 
A)  Specific identification 
B)  Average cost 
C)  FIFO 
D)  All of these answer choices are practical to use

Question 3

Shandy Shutters has the following inventory information.   A physical count of merchandise inventory on November 30 reveals that there are 100 units on hand. Assume a periodic inventory system is used. Ending inventory under FIFO is

Accepted Answer

A)  €657. 
B)  €1,268. 
C)  €632. 
D)  €1,294. 
A)  €657. 
B)  €1,268. 
C)  €632. 
D)  €1,294.

Question 4

Vestle Company uses the periodic inventory system. For January 2014, the beginning inventory consisted of 24,000 units that cost CHF12 each. During the month, the company made two purchases: 10,000 units at CHF13 each and 40,000 units at CHF13.50 each. Vestle sold 43,000 units during the month for CHF19.50 per unit. Using the average-cost method, what is the amount of cost of goods sold for the month of January 2014 (round per unit amount to two decimal places)?

Accepted Answer

A)  CHF556,850. 
B)  CHF579,000. 
C)  CHF539,500. 
D)  CHF559,000. 
A)  CHF556,850. 
B)  CHF579,000. 
C)  CHF539,500. 
D)  CHF559,000.

Question 5

Bueno Company's purchase and sales transactions for the month of July were as follows:   The company sold 8,000 units on July 22. Assuming that the company keeps perpetual inventory records, Bueno's ending inventory on a LIFO basis is

Accepted Answer

A)  €33,600. 
B)  €35,120. 
C)  €47,850. 
D)  €54,200. 
A)  €33,600. 
B)  €35,120. 
C)  €47,850. 
D)  €54,200.

Question 6

In a perpetual inventory system, the cost of goods sold under the FIFO method is based on the cost of the latest goods on hand during the period.

Accepted Answer

A) True 
 B)False

Question 7

Julian Junkets has the following inventory information.   Assuming that a perpetual inventory system is used, what is the ending inventory on a FIFO basis?

Accepted Answer

A)  $4,122 
B)  $4,131 
C)  $4,167 
D)  $8,694 
A)  $4,122 
B)  $4,131 
C)  $4,167 
D)  $8,694

Question 8

Bueno Company's purchase and sales transactions for the month of July were as follows:   The company sold 8,000 units on July 22. Assuming that Bueno keeps perpetual inventory records, inventory at July 31 on a moving-average basis is

Accepted Answer

A)  €34,400. 
B)  €35,300. 
C)  €52,680. 
D)  €48,650. 
A)  €34,400. 
B)  €35,300. 
C)  €52,680. 
D)  €48,650.

Question 9

In a period of rising prices, the costs allocated to ending inventory may be understated in the

Accepted Answer

A)  average-cost method. 
B)  FIFO method. 
C)  gross profit method. 
D)  LIFO method. 
A)  average-cost method. 
B)  FIFO method. 
C)  gross profit method. 
D)  LIFO method.

Question 10

In all cases when average-costing is used, the cost of goods sold would be the same whether a perpetual or periodic system is used.

Accepted Answer

A) True 
 B)False

Question 11

Toso Company uses the periodic inventory system to account for inventories. Information related to Toso Company's inventory at October 31 is given below:   
Instructions
1. Show computations to value the ending inventory using the FIFO cost assumption if 550 units remain on hand at October 31.
2. Show computations to value the ending inventory using the weighted-average cost method if 550 units remain on hand at October 31.
3. Show computations to value the ending inventory using the LIFO cost assumption if 550 units remain on hand at October 31.

Accepted Answer

The answer of Toso Company uses the periodic inventory system...

Question 12

Unitech has the following inventory information.   A physical count of merchandise inventory on July 31 reveals that there are 75 units on hand. Using the LIFO inventory method, the amount allocated to cost of goods sold for July is

Accepted Answer

A)  $1,450. 
B)  $1,550. 
C)  $3,450. 
D)  $3,550. 
A)  $1,450. 
B)  $1,550. 
C)  $3,450. 
D)  $3,550.

Question 13

Lois Howe and Ron Dole are department managers in the housewares and shoe departments, respectively, for Litwins, a large department store. Ron has observed Lois taking inventory from her own department home, apparently without paying for it. He hesitates confronting Lois because he is due to be promoted, and needs Lois' recommendation. He also does not want to notify the company management directly, because he doesn't want an ethics investigation on his record, believing that it will give him a "goody-goody" image. This week, Lois tried on several pairs of expensive running shoes in his department before finding a pair that suited her. She did not, however, buy them. That very pair was missing this morning.
Litwins recently replaced its old periodic inventory system with a perpetual inventory system using scanners and bar codes. In addition, the annual inventory is to be replaced by a monthly inventory conducted by an independent firm. On hearing the news of the changes, Ron relaxes. "The system will catch Lois now," he says to himself.
Required:
1. Is Ron's attitude justified? Why or why not?
2. What, if any, action should Ron take now?

Accepted Answer

1. Ron's attitude is not justified. The

Question 14

IFRS allows companies to cost inventory using either the LIFO or the FIFO cost flow assumption.

Accepted Answer

A) True 
 B)False

Question 15

It is generally recognized that a major objective of accounting for inventory is the proper determination of ______________.

Accepted Answer

The answer of It is generally recognized that a major...

Question 16

The following information is available for Witten Company:   
Instructions
Compute each of the following:
(a) Inventory turnover.
(b) Days in inventory.

Accepted Answer

The answer of The following information is available for Witten...

Question 17

Graham Company uses a periodic inventory system. Details for the inventory account for the month of January 2014 are as follows:   An end of the month (1/31/14) inventory showed that 120 units were on hand. If the company uses LIFO, what is the value of the ending inventory?

Accepted Answer

A)  $520 
B)  $600 
C)  $656 
D)  $1,480 
A)  $520 
B)  $600 
C)  $656 
D)  $1,480

Question 18

Manufacturers usually classify inventory into all the following general categories except

Accepted Answer

A)  work in process 
B)  finished goods 
C)  merchandise inventory 
D)  raw materials 
A)  work in process 
B)  finished goods 
C)  merchandise inventory 
D)  raw materials

Question 19

Unitech has the following inventory information.   A physical count of merchandise inventory on July 31 reveals that there are 75 units on hand. Using the average-cost method, the value of ending inventory is

Accepted Answer

A)  $1,450. 
B)  $1,500. 
C)  $1,525. 
D)  $1,550. 
A)  $1,450. 
B)  $1,500. 
C)  $1,525. 
D)  $1,550.

Question 20

Jenner Company had beginning inventory of $90,000, ending inventory of $110,000, cost of goods sold of $400,000, and sales of $660,000. Jenner's days in inventory is:

Accepted Answer

A) 55.3 days. 
B)  91.3 days. 
C)  101.4 days. 
D)  60.8 days. 
A) 55.3 days. 
B)  91.3 days. 
C)  101.4 days. 
D)  60.8 days.

Neighborly Industries has the following inventory information. Assuming that a periodic inventory system is used, what is the amount allocated to ending inventory on a FIFO basis?

Which one of the following inventory methods is often impractical to use?

Shandy Shutters has the following inventory information. A physical count of merchandise inventory on November 30 reveals that there are 100 units on hand. Assume a periodic inventory system is used. Ending inventory under FIFO is

Bueno Company's purchase and sales transactions for the month of July were as follows: The company sold 8,000 units on July 22. Assuming that the company keeps perpetual inventory records, Bueno's ending inventory on a LIFO basis is

In a perpetual inventory system, the cost of goods sold under the FIFO method is based on the cost of the latest goods on hand during the period.

Julian Junkets has the following inventory information. Assuming that a perpetual inventory system is used, what is the ending inventory on a FIFO basis?

Bueno Company's purchase and sales transactions for the month of July were as follows: The company sold 8,000 units on July 22. Assuming that Bueno keeps perpetual inventory records, inventory at July 31 on a moving-average basis is

In a period of rising prices, the costs allocated to ending inventory may be understated in the

In all cases when average-costing is used, the cost of goods sold would be the same whether a perpetual or periodic system is used.

Unitech has the following inventory information. A physical count of merchandise inventory on July 31 reveals that there are 75 units on hand. Using the LIFO inventory method, the amount allocated to cost of goods sold for July is

IFRS allows companies to cost inventory using either the LIFO or the FIFO cost flow assumption.

It is generally recognized that a major objective of accounting for inventory is the proper determination of ______________.

The following information is available for Witten Company: Instructions Compute each of the following: (a) Inventory turnover. (b) Days in inventory.

Graham Company uses a periodic inventory system. Details for the inventory account for the month of January 2014 are as follows: An end of the month (1/31/14) inventory showed that 120 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

Unitech has the following inventory information. A physical count of merchandise inventory on July 31 reveals that there are 75 units on hand. Using the average-cost method, the value of ending inventory is

Jenner Company had beginning inventory of $90,000, ending inventory of $110,000, cost of goods sold of $400,000, and sales of $660,000. Jenner's days in inventory is:

Accounting in Action

The Recording Process

Adjusting the Accounts

Completing the Accounting Cycle

Accounting for Merchandising Operations

Fraud, Internal Control, and Cash

Accounting for Receivables

Plant Assets, Natural Resources, and Intangible Assets

Liabilities

Corporations: Organization, Share Transactions, Dividends, and Retained Earnings

Investments

Statement of Cash Flows

Financial Statement Analysis

Accounting Principles and Contingent Liabilities in Business Operations

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Exam 6: Inventories

Neighborly Industries has the following inventory information. Assuming that a periodic inventory system is used, what is the amount allocated to ending inventory on a FIFO basis?

Which one of the following inventory methods is often impractical to use?

Shandy Shutters has the following inventory information. A physical count of merchandise inventory on November 30 reveals that there are 100 units on hand. Assume a periodic inventory system is used. Ending inventory under FIFO is

Bueno Company's purchase and sales transactions for the month of July were as follows: The company sold 8,000 units on July 22. Assuming that the company keeps perpetual inventory records, Bueno's ending inventory on a LIFO basis is

In a perpetual inventory system, the cost of goods sold under the FIFO method is based on the cost of the latest goods on hand during the period.

Julian Junkets has the following inventory information. Assuming that a perpetual inventory system is used, what is the ending inventory on a FIFO basis?

Bueno Company's purchase and sales transactions for the month of July were as follows: The company sold 8,000 units on July 22. Assuming that Bueno keeps perpetual inventory records, inventory at July 31 on a moving-average basis is

In a period of rising prices, the costs allocated to ending inventory may be understated in the

In all cases when average-costing is used, the cost of goods sold would be the same whether a perpetual or periodic system is used.

Unitech has the following inventory information. A physical count of merchandise inventory on July 31 reveals that there are 75 units on hand. Using the LIFO inventory method, the amount allocated to cost of goods sold for July is

IFRS allows companies to cost inventory using either the LIFO or the FIFO cost flow assumption.

It is generally recognized that a major objective of accounting for inventory is the proper determination of ______________.

The following information is available for Witten Company: Instructions Compute each of the following: (a) Inventory turnover. (b) Days in inventory.

Graham Company uses a periodic inventory system. Details for the inventory account for the month of January 2014 are as follows: An end of the month (1/31/14) inventory showed that 120 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

Unitech has the following inventory information. A physical count of merchandise inventory on July 31 reveals that there are 75 units on hand. Using the average-cost method, the value of ending inventory is

Jenner Company had beginning inventory of $90,000, ending inventory of $110,000, cost of goods sold of $400,000, and sales of $660,000. Jenner's days in inventory is:

Accounting in Action

The Recording Process

Adjusting the Accounts

Completing the Accounting Cycle

Accounting for Merchandising Operations

Fraud, Internal Control, and Cash

Accounting for Receivables

Plant Assets, Natural Resources, and Intangible Assets

Liabilities

Corporations: Organization, Share Transactions, Dividends, and Retained Earnings

Investments

Statement of Cash Flows

Financial Statement Analysis

Accounting Principles and Contingent Liabilities in Business Operations

Filters