Exam 6: Inventories

Lee Industries had the following inventory transactions occur during 2014: The company sold 204 units at $63 each and has a tax rate of 30%. Assuming that a periodic inventory system is used, what is the company's gross profit using FIFO? (rounded to whole dollars)

If a company has no beginning inventory and the unit price of inventory is increasing during a period, the cost of goods available for sale during the period will be the same under the average-cost and FIFO inventory methods.

The factor which determines whether goods in transit should be included in a physical count of inventory is

Overstating ending inventory will overstate all of the following except

The LIFO cost flow assumption can also be called the LISH assumption.

Instructions Using the inventory and sales data above, calculate the value assigned to cost of goods sold in March and to the ending inventory at March 31 using (a) FIFO and (b) LIFO.

Inventories affect

The inventory of Pedigo Company was destroyed by fire on April 1. From an examination of the accounting records, the following data for the first three months of the year are obtained: Instructions Determine the merchandise lost by fire, assuming a beginning inventory of $60,000 and a gross profit rate of 40% on net sales.

The LIFO inventory method assumes that the cost of the latest units purchased are

In applying the LIFO assumption in a perpetual inventory system, the cost of the units most recently purchased prior to sale is allocated first to the units sold.

Use of the FIFO inventory valuation method enables a company to report higher net income when in a period of falling prices.

If companies have identical inventory costs but use different inventory flow assumptions when the price of goods have not been constant, then the

Brocken Co. has the following data related to an item of inventory: The value assigned to cost of goods sold if Brocken uses average-cost is

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. Assuming that the specific identification method is used and that ending inventory consists of 30 units from each of the three purchases and 10 units from the November 1 inventory, cost of goods sold is

Brocken Co. has the following data related to an item of inventory: The value assigned to cost of goods sold if Brocken uses FIFO is

When valuing ending inventory under a perpetual inventory system, the

The following information is available for Massey Company: Assume that Massey uses a periodic inventory system and that there are 700 units left at the end of the month. Instructions Compute each of the following under the average-cost method: (a) Cost of ending inventory. (b) Cost of goods sold.

If the inventory reported on the statement of financial position is understated, then net income reported on the income statement is understated.

Hoyt Company's inventory records show the following data for the month of September: A physical inventory on September 30 shows 200 units on hand. Calculate the value of the ending inventory and cost of goods sold if the company uses weighted average inventory costing and a periodic inventory system. Round cost per unit to 2 decimal places and ending inventory and cost of goods sold to the nearest dollar.

Lee Industries had the following inventory transactions occur during 2014: The company sold 204 units at $63 each and has a tax rate of 30%. Assuming that a periodic inventory system is used, what is the company's after-tax income using FIFO? (rounded to whole dollars)