Exam 7: Inventory

Phoenix Ltd sells hard disks of similar make and model and reports an opening inventory on 1 July 2012 of 20 units purchased at $60.Its purchases during are as follows: September 90 units @ $70 November 110 units @ $75 March 70 units @ $80 Phoenix Ltd sold 260 units during the year. What is the cost of ending inventory using FIFO and weighted average method,respectively (rounded to the nearest dollar)?

The cost-flow assumption selected for inventory costing purposes should always reflect the physical flow of goods out of inventory:

Consistent with positive accounting theory,an entity close to breaching their debt covenant will:

The only difference between the old AASB 1019 and the new AASB 102 is that the 'international' standards allow inventory to be valued using LIFO:

According to AASB 102,one or more of which set of methods should be used to apply the costs of inventories to particular items of inventory?

Handy Ltd produces a line of brooms.The summary cost information for brooms for the year ended 30 June 2002 is: The level of output for the period was the normal level of production of 290,000 units.What is the cost per broom (rounded to the nearest cent)in accordance with AASB 102 requirements?

Standard costs are able to be used under AASB 102 where:

According to AASB 102 material information relating to which of the following must be disclosed?

Paris Merchandising Ltd sells ladies skirts.The opening stock consisted of 300 skirts with purchase price of $50 each.Subsequent purchases during the period include: 400 at $60 each and another 200 for $70 each.A total of 700 skirts were sold during the period.What is ending inventory using FIFO method?

The following information relates to the total production costs and estimates of realisable value for a line of water pistols produced by Splash Happy Co LtD. Packaging and transport costs are necessarily incurred in order to be able to sell the inventory.What is the value of the inventory in accordance with AASB 102?

Circle Ltd manufactures polystyrene trays for a variety of purposes.The following information relates to the production of the medium trays used by meat packing companies for the period ended 30 June 2003. The company uses a perpetual inventory system.The net realisable value per extra large cardboard box is $0.17 at the end of the period.What are the costs of sales and the value of ending inventory for Rectangle Ltd assuming the FIFO cost-flow assumption is used?

Balmoral Ltd commenced business on 1 July 2003.The company manufactures bookcases.Summary data for Balmoral's first full year of operations are: Packaging and delivery are essential to be able to sell the product.What total value should be attributed to finished goods inventory in the financial statements in accordance with AASB 102?

Which of the following is not a definition in AASB 102 on inventories:

The inventory record of Palm Springs Ltd.shows 1,000 surf boards on stock that cost $50 each.During the last stock take,the accountant noted 100 old style surf boards with net realisable amount of $15.What journal entry would be required of Palm Springs to comply with AASB 102?

Randwick Ltd has a year-end of 30 June 2009.During the year the following errors were discovereD. -Merchandise inventory at the factory had been understated by $44,000. -Goods on consignment from a supplier for $13,000 were included in inventory at the shops. -Physical inventory for one warehouse had a shortage of $58,000 What is the net effect of above errors in the income statement and balance sheet (inventory)accounts of Randwick Ltd?

AASB 102 applies to all inventories including work in progress under construction contracts:

Upward revaluation of inventory is permitted for as long as all assets in same inventory class are revalued.

Which accounting policy for manufacturing fixed costs is likely to favour managers whose firms are subject to political scrutiny?

Reversal of a previous inventory write down is not advocated in AASB 102.

Some biological assets may be covered by AASB 102 "Inventories":