Exam 5: Inventory

Given the following inventory activity, what is ending inventory using the perpetual FIFO costing method? (Round any intermediary calculations to the nearest cent and your final answer to the nearest dollar.)

Under the specific-identification method, the flow of costs through the accounting records will:

If a company experiences a loss of inventory for fire, there is no way to estimate the inventory.

Inventory errors cancel out after two periods.

The choice of inventory costing method does not have an effect on net income.

Cost of goods available for sale minus estimated Cost of Goods Sold yields the estimated:

When using LIFO, an accounting department only needs to know:

Goods available for sale are $113,000; beginning inventory is $35,000; ending inventory is $39,000; and cost of goods sold is $73,000. The days-sales-in-inventory is closest to: (Round any intermediary calculations two decimal places, X.XX, and your final answer to the nearest day.)

In order to pay the least income tax possible in periods of decreasing inventory costs, the company should use which of the following inventory costing methods?

Manufacturers have three different kinds of inventory.

If inventory shrinkage has occurred, the Inventory account will be credited for the amount of lost inventory.

To save time when performing physical inventory counts, outside companies are rarely used because they are not familiar with the inventory.

A manufacturer's goods available for sale represents:

Lionworks Enterprises had the following inventory data: Assuming FIFO, what is the cost of goods sold for the July 7 sale?

Changing from LIFO to FIFO over two accounting periods could be viewed as a violation of which accounting concept or principle?

________ produces the highest cost of goods sold and the lowest gross profit when prices are increasing.

In order to pay the least income tax possible in periods of constant costs, the company should use which of the following inventory costing methods?

If Cost of Goods Sold was understated in Period 1, then Cost of Goods Sold and gross profit in Period 2 will be:

The ending inventory of one year becomes the beginning inventory of the next year.

The Classics Collectibles, an antique shop, would most likely use the FIFO method of accounting for inventory.