Question 1

Determine the total value of the merchandise using net realizable value.

Accepted Answer

A)  $35 
B)  $80 
C)  $115 
D)  $25 
A)  $35 
B)  $80 
C)  $115 
D)  $25

Question 2

If ending inventory for the year is overstated,stockholders' equity reported on the balance sheet at the end of the year is understated.

Accepted Answer

A) True 
 B)False

Question 3

What is the amount of cost of goods sold for the year according to the average cost method?

Accepted Answer

A)  $1,380 
B)  $1,375 
C)  $1,510 
D)  $1,250 
A)  $1,380 
B)  $1,375 
C)  $1,510 
D)  $1,250

Question 4

Based on the following information,compute (a)inventory turnover; (b)average daily cost of goods sold using a 365 day year; and (c)number of days' sales in inventory.
​
Cost of goods sold $195,640
Inventory:
Beginning 20,500
Ending 18,628

Accepted Answer

(a)$195,640 ÷ [($20,500 + 18,6

Question 5

Inventory at the end of the year was understated.Which of the following statements correctly states the effect of the error?

Accepted Answer

A)  net income is understated 
B)  net income is overstated 
C)  cost of goods sold is understated 
D)  inventory reported on the balance sheet is overstated 
A)  net income is understated 
B)  net income is overstated 
C)  cost of goods sold is understated 
D)  inventory reported on the balance sheet is overstated

Question 6

Applying the lower of cost or market to each item of inventory,what should the total inventory value be for the following items?
​

Accepted Answer

The answer of Applying the lower of cost or market...

Question 7

The choice of an inventory costing method has no significant impact on the financial statements.

Accepted Answer

A) True 
 B)False

Question 8

Assume that three identical units of merchandise were purchased during October,as follows:
​
​
   Assume one unit is sold on October 31 for $28.Determine cost of goods sold,gross profit,and ending inventory under the LIFO method.

Accepted Answer

The answer of Assume that three identical units of merchandise...

Question 9

The specific identification inventory method should be used when the inventory consists of identical,low-cost units that are purchased and sold frequently.

Accepted Answer

A) True 
 B)False

Question 10

If a fire destroys the inventory,the gross profit method can be used to estimate the cost of merchandise destroyed.

Accepted Answer

A) True 
 B)False

Question 11

If the revenues are correctly reported and the gross profit of a company is understated,what is the effect on stockholders' equity?

Accepted Answer

A)  understated 
B)  overstated 
C)  correctly stated 
D)  none of these 
A)  understated 
B)  overstated 
C)  correctly stated 
D)  none of these

Question 12

Safeguarding inventory and proper reporting of the inventory in the financial statements are the reasons for controlling the inventory.

Accepted Answer

A) True 
 B)False

Question 13

Which document authorizes the purchase of the inventory from an approved vendor?​

Accepted Answer

A)  ​the purchase order 
B)  ​the petty cash voucher 
C)  the receiving report 
D)  the vendor's invoice 
A)  ​the purchase order 
B)  ​the petty cash voucher 
C)  the receiving report 
D)  the vendor's invoice

Question 14

If ending inventory for the year is understated,net income for the year is overstated.

Accepted Answer

A) True 
 B)False

Question 15

Assuming that the company uses the perpetual inventory system,determine the cost of goods sold for the sale of May 20 using the FIFO inventory cost method.

Accepted Answer

A)  $120 
B)  $180 
C)  $136 
D)  $144 
A)  $120 
B)  $180 
C)  $136 
D)  $144

Question 16

Three identical units of merchandise were purchased during March,as shown:
​
​
   Assume that one unit is sold on March 23 for $1,125.Determine the gross profit for March and ending inventory on March 31 using (a)FIFO and (b)LIFO.

Accepted Answer

The answer of Three identical units of merchandise were purchased...

Question 17

Under a perpetual inventory system,the amount of each type of merchandise on hand is available in the

Accepted Answer

A)  customer's ledger 
B)  creditor's ledger 
C)  inventory ledger 
D)  purchase ledger 
A)  customer's ledger 
B)  creditor's ledger 
C)  inventory ledger 
D)  purchase ledger

Question 18

"Market" as used in the phrase "lower of cost or market" for valuing inventory,refers to the price at which the inventory is being offered for sale by the company.

Accepted Answer

A) True 
 B)False

Question 19

On the basis of the following data,what is the estimated cost of the inventory on May 31 using the retail method? ​

Accepted Answer

A)  $250,000 
B)  $360,000 
C)  $172,500 
D)  $187,500 
A)  $250,000 
B)  $360,000 
C)  $172,500 
D)  $187,500

Question 20

On the basis of the following data,determine the value of the inventory at the lower of cost or market.Apply lower of cost or market to each inventory item.Show your work.

Accepted Answer

The answer of On the basis of the following data,determine...

Exam 6: Inventories

Determine the total value of the merchandise using net realizable value.

If ending inventory for the year is overstated,stockholders' equity reported on the balance sheet at the end of the year is understated.

What is the amount of cost of goods sold for the year according to the average cost method?

Based on the following information,compute (a)inventory turnover; (b)average daily cost of goods sold using a 365 day year; and (c)number of days' sales in inventory. ​ Cost of goods sold $195,640 Inventory: Beginning 20,500 Ending 18,628

Inventory at the end of the year was understated.Which of the following statements correctly states the effect of the error?

Applying the lower of cost or market to each item of inventory,what should the total inventory value be for the following items? ​

The choice of an inventory costing method has no significant impact on the financial statements.

Assume that three identical units of merchandise were purchased during October,as follows: ​ ​ Assume one unit is sold on October 31 for $28.Determine cost of goods sold,gross profit,and ending inventory under the LIFO method.

The specific identification inventory method should be used when the inventory consists of identical,low-cost units that are purchased and sold frequently.

If a fire destroys the inventory,the gross profit method can be used to estimate the cost of merchandise destroyed.

If the revenues are correctly reported and the gross profit of a company is understated,what is the effect on stockholders' equity?

Safeguarding inventory and proper reporting of the inventory in the financial statements are the reasons for controlling the inventory.

Which document authorizes the purchase of the inventory from an approved vendor?​

If ending inventory for the year is understated,net income for the year is overstated.

Assuming that the company uses the perpetual inventory system,determine the cost of goods sold for the sale of May 20 using the FIFO inventory cost method.

Three identical units of merchandise were purchased during March,as shown: ​ ​ Assume that one unit is sold on March 23 for $1,125.Determine the gross profit for March and ending inventory on March 31 using (a)FIFO and (b)LIFO.

Under a perpetual inventory system,the amount of each type of merchandise on hand is available in the

"Market" as used in the phrase "lower of cost or market" for valuing inventory,refers to the price at which the inventory is being offered for sale by the company.

On the basis of the following data,what is the estimated cost of the inventory on May 31 using the retail method? ​

On the basis of the following data,determine the value of the inventory at the lower of cost or market.Apply lower of cost or market to each inventory item.Show your work.

Introduction to Accounting and Business

Analyzing Transactions

The Adjusting Process

Completing the Accounting Cycle

Accounting for Merchandising Businesses

Internal Control and Cash

Receivables

Long-Term Assets: Fixed and Intangible

Liabilities: Current,installment Notes,and Contingencies

Liabilities: Bonds Payable

Corporations: Organization, stock Transactions, and Dividends

Statement of Cash Flows

Financial Statement Analysis

Introduction to Managerial Accounting

Job Order Costing

Process Cost Systems

Activity-Based Costing

Cost-Volume-Profit Analysis

Variable Costing for Management Analysis

Budgeting

Evaluating Variances From Standard Costs

Evaluating Decentralized Operations

Differential Analysis and Product Pricing

Capital Investment Analysis

Lean Manufacturing and Activity Analysis

Filters

Based on the following information,compute (a)inventory turnover; (b)average daily cost of goods sold using a 365 day year; and (c)number of days' sales in inventory. Cost of goods sold $195,640 Inventory: Beginning 20,500 Ending 18,628

Applying the lower of cost or market to each item of inventory,what should the total inventory value be for the following items?

Assume that three identical units of merchandise were purchased during October,as follows: Assume one unit is sold on October 31 for $28.Determine cost of goods sold,gross profit,and ending inventory under the LIFO method.

Which document authorizes the purchase of the inventory from an approved vendor?

Three identical units of merchandise were purchased during March,as shown: Assume that one unit is sold on March 23 for $1,125.Determine the gross profit for March and ending inventory on March 31 using (a)FIFO and (b)LIFO.

On the basis of the following data,what is the estimated cost of the inventory on May 31 using the retail method?