Exam 5: Inventories and Cost of Sales

A company made the following merchandise purchases and sales during the current month: July 1 purchased 380 units at \ 15 each July 5 purchased 270 units at \ 20 each July 9 sold 500 units at \ 55 each July 14 purchased 300 units at \ 24 each July 20 sold 250 units at \ 55 each July 30 purchased 250 units at \ 30 each There was no beginning inventory.If the company uses the last-in,first-out perpetual inventory system,what would be the cost of the ending inventory?

A corporation uses a LIFO perpetual inventory system. August 2,25 units were purchased at $12 per unit. August 5,10 units were purchased at $13 per unit. August 15,12 units were sold at $25 per unit. August 18,15 units were purchased at $14 per unit. What was the amount of the ending inventory for the month of August?

A company made the following merchandise purchases and sales during the month of May: May 1 purchased 380 units at \ 15 each May 5 purchased 270 units at \ 17 each May 10 sold 400 units at \ 50 each May 20 purchased 300 units at \ 22 each May 25 sold 400 units at \ 50 each There was no beginning inventory.If the company uses the weighted-average perpetual inventory method,what would be the cost of its ending inventory?

The _________________ method is commonly used to estimate the value of inventory that has been destroyed,lost or stolen.

Goods on consignment:

Explain the effects of inventory valuation methods on the cost of ending inventory,income,and income taxes.

A company's store was destroyed by a fire on February 10 of this year.The only information for the current period that could be salvaged included the following: Beginning inventory,January 1: $34,000 Purchases to date: $118,000 Sales to date: $140,000 Historically,the company's gross profit ratio has been 30%.Estimate the value of the destroyed inventory using the gross profit method.

Given the following information,determine the cost of ending inventory at December 31 using the weighted-average perpetual inventory method.Assume this is the first month of the company's operations. December 2: 5 units were purchased at $7 per unit. December 9: 10 units were purchased at $9.40 per unit. December 12: 2 units were sold.

During January,a company that uses a perpetual inventory system had beginning inventory,purchases and sales as follows.What was the FIFO cost of the company's January 31 inventory?

It can be expected that companies that sell perishable goods have higher inventory turnover than companies that sell nonperishable goods.

What is the effect of an error in the ending inventory balance on the income statement?

Physical inventory counts:

Identify the items that are included in merchandise inventory.(In your answer address the special situations of goods in transit,consigned goods,and damaged goods.)

Monthly or quarterly statements are called interim statements because they are prepared between the traditional annual statement dates.

A company made the following merchandise purchases and sales during the month of July: July 1 purchased 380 units at \ 15 each July 5 purchased 270 units at \ 20 each July 9 sold 500 units at \ 55 each July 14 purchased 300 units at \ 24 each July 20 sold 250 units at \ 55 each July 30 purchased 250 units at \ 30 each There was no beginning inventory.If the company uses the first-in,first-out perpetual inventory method,what would be the cost of the ending inventory?

A company normally sells its product for $20 per unit.However,the selling price has fallen to $15 per unit.This company's current inventory consists of 200 units purchased at $16 per unit.Replacement cost has now fallen to $13 per unit.Calculate the value of this company's inventory at the lower of cost or market.

In the retail inventory method of inventory valuation,the retail amount of inventory refers to the dollar amount measured by looking at the selling prices of inventory items.

When units are purchased at different costs over time,it is simple to determine the cost per unit assigned to inventory.

The consistency concept:

When the __________ method is used with a periodic inventory system,cost of goods sold is assigned costs from the most recent purchases for the period.