Exam 11: Inventory

Assuming that a perpetual inventory system is used, what is the ending inventory (round per unit amounts to the nearest cent and the final answer to the nearest dollar) under the moving-average cost method?

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

Inventories are estimated

If a company uses the FIFO cost flow method, the cost of goods sold for the period will be the same under both perpetual and periodic inventory systems.

A new average cost is computed each time a purchase is made in the

Inventory is classified in the balance sheet as

Under the LCNRV approach, inventory is valued at the lower of cost or

At May 1, 2022, Bibby Company had beginning inventory consisting of 200 units with a unit cost of $7. During May, the company purchased inventory as follows: 800 units at $7 600 units at $8 The company sold 1,000 units during the month for $12 per unit. Bibby uses periodic inventory system and the average cost method. The average cost per unit for May is

For companies that use a perpetual inventory system, all of the following are reasons for taking a physical inventory except

Compute the LCNRV valuation for Gantner Company's total inventory based on the following: Inventory Categories Cost Data NRV \ 18,000 \ 16,900 13,900 14,600 21,000 20,500

Tipp Topp Company uses a periodic inventory system and reports the following for the month of June. Units Unit Cost Total Cost June 1 Inventory 300 \ 5 \ 1,500 12 Purchase 450 6 2,700 23 Purchase 750 7.60 5,700 30 Inventory 160 Instructions (a) Compute the cost of the ending inventory and the cost of goods sold under (1) FIFO and (2) LIFO. (b) Compute the cost of the ending inventory and the cost of goods sold using the average-cost method.

Liche Company reported net income of $54,000 in 2022 and $80,000 in 2023. However, ending inventory was overstated by $6,000 in 2022. Instructions Compute the correct net income for Liche Company for 2022 and 2023.

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

Under the LCNRV basis, NRV is net realizable value.

Berry, Inc. has 6 computers which have been part of the inventory for over two years. Each computer cost $600 and originally retailed for $900. At the statement date, each computer has a net realizable value of $450. How much loss should Berry, Inc., record for the year?

Morton Watch Company reported the following income statement data for a 2-year period. Mortan uses a periodic inventory system. The inventories at January 1, 2022, and December 31, 2023, are correct. However, the ending inventory at December 31, 2022, was overstated $5,000. Instructions (a) Prepare correct income statement data for the 2 years. (b) What is the cumulative effect of the inventory error on total gross profit for the 2 years?

Crosby Department Store estimates inventory by using the retail inventory method. The following information was developed: at cost at retail begining inventory \4 65,000 \7 50,000 goods purchases 900,000 1,350,000 net sales 1,500,000 The estimated cost of the ending inventory is

Shellhammer Company's inventory and purchases accounts show the following data for the month of September: Units Unit Cost Inventory, September 1 100 \ 3.34 Purchases: September 8 450 3.50 September 18 350 3.70 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 the weighted average method 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.

Laurie Company applied FIFO to its inventory and got the following results for its ending inventory. DVRs 140 units at a cost per unit of \ 60 DVD players 210 units at a cost per unit of \ 75 iPods 175 units at a cost per unit of \ 80 The net realizable value of units at year-end was DVRs $68, DVD players $70, and iPods $76. Instructions Determine the amount of ending inventory at LCNRV.

The manager of Stone Company is given a bonus based on gross profit . Gross profit is $11,500 for FIFO and $10,100 for LIFO. The bonus rate is 15%. How much higher (lower) is the manager's bonus if FIFO is adopted instead of LIFO?