Exam 7: Inventories

Use this inventory information for the month of September to answer the following question. Assuming that a perpetual inventory system is used,what is ending inventory on a FIFO basis?

When applying the lower-of-cost-or-market rule to inventory valuation,market generally means

In which of the following cases would the gross profit method most likely be used?

Up to the date of a fire that completely destroyed Clark's inventory,Clark had sales of $4,000,000,purchases of $3,600,000,and freight-in of $160,000.The cost of beginning inventory was $280,000 and the company's typical gross profit was 40 percent.Using the gross profit method,estimate Clark's inventory loss from the fire.(Show your work.)

Under the periodic inventory system,cost of goods sold is recorded throughout the accounting period as inventory is sold.

Match each definition with the correct term below. -Just-in-time operating environment

Match each definition with the correct term below. -Retail method

Average inventory equals $200,000,and cost of goods sold equals $432,000.Days' inventory on hand equals

Jayne's Department Store had net retail sales of $310,000 during the current year.The following additional information was obtained from the accounting records. Estimate the company's ending inventory at cost using the retail method.(Show your work.)

In periods of declining prices,the FIFO method will result in a larger gross margin than the LIFO method.

Use this inventory information for the month of November to answer the following question. What is cost of goods sold under the specific identification method?

All of the following are inventory costing methods except

How is the matching rule applied when accounting for merchandise inventory?

Use this information to answer the following question. A periodic inventory system is used. Cost of goods sold under the average-cost method is

Which of the following is an inventory valuation method?

The LIFO method tends to smooth out the peaks and valleys of a business cycle.

An understatement of ending inventory in a period will result in an understatement of gross margin in the next period.

An overstatement of beginning inventory results in

Match each definition with the correct term below. -Gross profit method

In a period of rising prices,which of the following inventory methods generally results in the highest gross margin figure?