Exam 8: Valuation of Inventories: a Cost-Basis Approach

When a company uses LIFO for external reporting purposes and FIFO for internal reporting purposes, an Allowance to Reduce Inventory to LIFO account is used.This account should be reported

How should the following costs affect a retailer's inventory valuation?

Chess Top uses the periodic inventory system.For the current month, the beginning inventory consisted of 200 units that cost $65 each.During the month, the company made two purchases: 300 units at $68 each and 150 units at $70 each.Chess Top also sold 500 units during the month.Using the LIFO method, what is the amount of cost of goods sold for the month?

Chess Top uses the periodic inventory system.For the current month, the beginning inventory consisted of 200 units that cost $65 each.During the month, the company made two purchases: 300 units at $68 each and 150 units at $70 each.Chess Top also sold 500 units during the month.Using the average cost method, what is the amount of ending inventory?

Use the following information for Hay Company had January 1 inventory of $100,000 when it adopted dollar-value LIFO.During the year, purchases were $600,000 and sales were $1,000,000.December 31 inventory at year-end prices was $126,500, and the price index was 110. -What is Hay Company's gross profit?

Use the following information for questions. Transactions for the month of June were: -Assuming that perpetual inventory records are kept in dollars, the ending inventory on a LIFO basis is

The pricing of issues from inventory must be deferred until the end of the accounting period under the following method of inventory valuation:

Use the following information for questions. The following information was available from the inventory records of Rich Company for January: -Assuming that Rich does not maintain perpetual inventory records, what should be the inventory at January 31, using the weighted-average inventory method, rounded to the nearest dollar?

The following information was derived from the 2010 accounting records of Perez Co.: Perez's 2010 cost of sales was

In a period of rising prices, the inventory method which tends to give the highest reported inventory is

On June 15, 2010, Wynne Corporation accepted delivery of merchandise which it Purchased on account.As of June 30, Wynne had not recorded the transaction or included the merchandise in its inventory.The effect of this on its statement of financial position for June 30, 2010 would be

The dollar-value LIFO method measures any increases and decreases in a pool in terms of total dollar value and physical quantity of the goods.

During periods of rising prices, a perpetual inventory system would result in the same dollar amount of ending inventory as a periodic inventory system under which of the following inventory cost flow methods?

The International Accounting Standards Board requires the specific identification method when unit price is low, inventory turnover is high, and inventory quantities are large.

Tang, Inc.sells collectible jewelry on consignment from various manufacturers and should include this consigned inventory on its statement of financial position.

Under IFRS, agricultural inventories, such as wheat, oranges, etc., are recorded at their fair value less estimated selling costs at the point of harvest.

Which of the following is included in inventory costs?

IFRS requires manufacturers to disclose their inventory components on the statement of financial position or in related notes.

White Corporation uses the FIFO method for internal reporting purposes and LIFO for external reporting purposes.The balance in the LIFO Reserve account at the end of 2010 was $80,000.The balance in the same account at the end of 2011 is $120,000.White's Cost of Goods Sold account has a balance of $600,000 from sales transactions recorded during the year.What amount should White report as Cost of Goods Sold in the 2011 income statement?

Companies must allocate the cost of all the goods available for sale (or use) between