Question 1

Use this information to answer the following question.   A periodic inventory system is used.
Ending inventory under LIFO is

Accepted Answer

A)  $904. 
B)  $858. 
C)  $428. 
D)  $474. 
A)  $904. 
B)  $858. 
C)  $428. 
D)  $474.

Question 2

Days' inventory on hand equals 365 divided by

Accepted Answer

A)  inventory turnover. 
B)  cost of goods sold. 
C)  goods available for sale. 
D)  average inventory. 
A)  inventory turnover. 
B)  cost of goods sold. 
C)  goods available for sale. 
D)  average inventory.

Question 3

The costs included in work in process and finished goods inventories would not contain manufacturing overhead costs.

Accepted Answer

A) True 
 B)False

Question 4

Assuming that ending inventory for 2012 was understated,indicate whether each of the following will be understated (U),overstated (O),or not affected (N).
_____ 1.Beginning inventory for 2013
_____ 2.Cost of goods sold for 2012
_____ 3.Stockholders' equity at the end of 2013
_____ 4.Income before income taxes for 2013
_____ 5.Stockholders' equity at the end of 2012
_____ 6.Cost of goods sold for 2013
_____ 7.Income before income taxes for 2012

Accepted Answer

The answer of Assuming that ending inventory for 2012 was...

Question 5

The LIFO method is rarely used because most companies do not sell the last goods they purchase first.

Accepted Answer

A) True 
 B)False

Question 6

Inventory turnover is expressed in terms of

Accepted Answer

A)  days. 
B)  a percentage. 
C)  dollars. 
D)  times. 
A)  days. 
B)  a percentage. 
C)  dollars. 
D)  times.

Question 7

An overstatement of ending inventory in a period will result in an understatement of gross margin in that period.

Accepted Answer

A) True 
 B)False

Question 8

The following information is available for Sawyer Company.
   Using this information,compute the cost of inventory for Sawyer company at the end of the year.

Accepted Answer

$32,000 - $5,000 + $

Question 9

In a period of declining prices,which of the following inventory methods generally results in the highest balance sheet figure for inventory?

Accepted Answer

A)  LIFO 
B)  Cannot tell without more information 
C)  FIFO 
D)  Average-cost 
A)  LIFO 
B)  Cannot tell without more information 
C)  FIFO 
D)  Average-cost

Question 10

The LIFO inventory method produces the most up-to-date figure for ending inventory.

Accepted Answer

A) True 
 B)False

Question 11

The LIFO method agrees with the actual physical goods flow in most businesses.

Accepted Answer

A) True 
 B)False

Question 12

Which inventory method generally best follows the matching principle?

Accepted Answer

A)  Average-cost 
B)  LIFO 
C)  Whichever method is used for tax purposes 
D)  FIFO 
A)  Average-cost 
B)  LIFO 
C)  Whichever method is used for tax purposes 
D)  FIFO

Question 13

Days' inventory on hand equals the inventory turnover divided by 365.

Accepted Answer

A) True 
 B)False

Question 14

Specific identification is a very popular inventory method because it is very easy to apply.

Accepted Answer

A) True 
 B)False

Question 15

Match each definition with the correct term below.
-Specific identification method

Accepted Answer

A) An inventory management system in which the Internet is used to order and track goods. 
B) A method of valuing inventory that assumes that costs of the first items acquired should be assigned to the first items sold. 
C) A method of estimating inventory that uses the ratio of cost to retail price. 
D) Merchandise that its owner places on the premises of another company with the understanding that payment will be made only when the merchandise is sold. 
E) An inventory management system in which goods arrive just at the time they are needed.
F)when sales have reduced inventories below the levels set in prior years.
G)A method of estimating inventory that assumes the gross margin for a business remains relatively stable from year to year.
H)The association of costs with their assumed flow in the operations of a company.
I)A method of valuing inventory that assumes that the costs of the last items purchased should be assigned to the first items sold.
J)A method of valuing inventory that identifies the cost of each item in ending inventory. 
A) An inventory management system in which the Internet is used to order and track goods. 
B) A method of valuing inventory that assumes that costs of the first items acquired should be assigned to the first items sold. 
C) A method of estimating inventory that uses the ratio of cost to retail price. 
D) Merchandise that its owner places on the premises of another company with the understanding that payment will be made only when the merchandise is sold. 
E) An inventory management system in which goods arrive just at the time they are needed.
F)when sales have reduced inventories below the levels set in prior years.
G)A method of estimating inventory that assumes the gross margin for a business remains relatively stable from year to year.
H)The association of costs with their assumed flow in the operations of a company.
I)A method of valuing inventory that assumes that the costs of the last items purchased should be assigned to the first items sold.
J)A method of valuing inventory that identifies the cost of each item in ending inventory.

Question 16

Supply-chain management works well in a just-in-time operating environment.

Accepted Answer

A) True 
 B)False

Question 17

Use the following information to calculate cost of goods sold under each of three methods: (a)FIFO,(b)LIFO,and (c)average-cost.Assume the periodic inventory system is used.(Show your work.)

Accepted Answer

Total Sales: 70 + 110 = 180 un

Question 18

When the average-cost method is applied to a perpetual inventory system,a moving average cost per unit is computed with each purchase.

Accepted Answer

A) True 
 B)False

Question 19

Which of the following accounts would not appear as an asset on a manufacturer's balance sheet?

Accepted Answer

A)  Finished Goods 
B)  Work in Process 
C)  Factory Overhead 
D)  Raw Materials 
A)  Finished Goods 
B)  Work in Process 
C)  Factory Overhead 
D)  Raw Materials

Question 20

Which of the following inventory methods when used for income tax purposes must also be used for reporting purposes?

Accepted Answer

A)  Specific identification 
B)  LIFO 
C)  FIFO 
D)  Average-cost 
A)  Specific identification 
B)  LIFO 
C)  FIFO 
D)  Average-cost

Use this information to answer the following question. A periodic inventory system is used. Ending inventory under LIFO is

Days' inventory on hand equals 365 divided by

The costs included in work in process and finished goods inventories would not contain manufacturing overhead costs.

The LIFO method is rarely used because most companies do not sell the last goods they purchase first.

Inventory turnover is expressed in terms of

An overstatement of ending inventory in a period will result in an understatement of gross margin in that period.

The following information is available for Sawyer Company. Using this information,compute the cost of inventory for Sawyer company at the end of the year.

In a period of declining prices,which of the following inventory methods generally results in the highest balance sheet figure for inventory?

The LIFO inventory method produces the most up-to-date figure for ending inventory.

The LIFO method agrees with the actual physical goods flow in most businesses.

Which inventory method generally best follows the matching principle?

Days' inventory on hand equals the inventory turnover divided by 365.

Specific identification is a very popular inventory method because it is very easy to apply.

Match each definition with the correct term below. -Specific identification method

Supply-chain management works well in a just-in-time operating environment.

Use the following information to calculate cost of goods sold under each of three methods: (a)FIFO,(b)LIFO,and (c)average-cost.Assume the periodic inventory system is used.(Show your work.)

When the average-cost method is applied to a perpetual inventory system,a moving average cost per unit is computed with each purchase.

Which of the following accounts would not appear as an asset on a manufacturer's balance sheet?

Which of the following inventory methods when used for income tax purposes must also be used for reporting purposes?

Uses of Accounting Information and the Financial Statements

Analyzing Business Transactions

Measuring Business Income

Supplement - Closing Entries and the Work Sheet

Financial Reporting and Analysis

The Operating Cycle and Merchandising Operations

Cash and Receivables

Current Liabilities and Fair Value Accounting

Long Term Assets

Long-Term Liabilities

Stockholders Equity

The Statement of Cash Flows

Financial Performance Measurement

Investments

Filters

Exam 7: Inventories

Use this information to answer the following question. A periodic inventory system is used. Ending inventory under LIFO is

Days' inventory on hand equals 365 divided by

The costs included in work in process and finished goods inventories would not contain manufacturing overhead costs.

The LIFO method is rarely used because most companies do not sell the last goods they purchase first.

Inventory turnover is expressed in terms of

An overstatement of ending inventory in a period will result in an understatement of gross margin in that period.

The following information is available for Sawyer Company. Using this information,compute the cost of inventory for Sawyer company at the end of the year.

In a period of declining prices,which of the following inventory methods generally results in the highest balance sheet figure for inventory?

The LIFO inventory method produces the most up-to-date figure for ending inventory.

The LIFO method agrees with the actual physical goods flow in most businesses.

Which inventory method generally best follows the matching principle?

Days' inventory on hand equals the inventory turnover divided by 365.

Specific identification is a very popular inventory method because it is very easy to apply.

Match each definition with the correct term below. -Specific identification method

Supply-chain management works well in a just-in-time operating environment.

Use the following information to calculate cost of goods sold under each of three methods: (a)FIFO,(b)LIFO,and (c)average-cost.Assume the periodic inventory system is used.(Show your work.)

When the average-cost method is applied to a perpetual inventory system,a moving average cost per unit is computed with each purchase.

Which of the following accounts would not appear as an asset on a manufacturer's balance sheet?

Which of the following inventory methods when used for income tax purposes must also be used for reporting purposes?

Uses of Accounting Information and the Financial Statements

Analyzing Business Transactions

Measuring Business Income

Supplement - Closing Entries and the Work Sheet

Financial Reporting and Analysis

The Operating Cycle and Merchandising Operations

Cash and Receivables

Current Liabilities and Fair Value Accounting

Long Term Assets

Long-Term Liabilities

Stockholders Equity

The Statement of Cash Flows

Financial Performance Measurement

Investments

Filters