Question 1

Goods held on consignment are

Accepted Answer

A)  kept for sale on the premises of the consignor. 
B)  included as part of no one's ending inventory. 
C)  never owned by the consignee. 
D)  included in the consignee's ending inventory. 
A)  kept for sale on the premises of the consignor. 
B)  included as part of no one's ending inventory. 
C)  never owned by the consignee. 
D)  included in the consignee's ending inventory.

Question 2

Inventory turnover is a measure expressed in terms of a percentage.

Accepted Answer

A) True 
 B)False

Question 3

Ending merchandise inventory for LIFO will be the same dollar amount under a periodic inventory system as under a perpetual inventory system.

Accepted Answer

A) True 
 B)False

Question 4

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 5

A retail store has beginning inventory of $30,000, purchases of $220,000, sales of $200,000, and a normal gross margin of 25 percent. What is estimated inventory based on these facts and the gross profit method?

Accepted Answer

A)  $50,000 
B)  $150,000 
C)  $100,000 
D)  $200,000 
A)  $50,000 
B)  $150,000 
C)  $100,000 
D)  $200,000

Question 6

The higher the inventory turnover, the higher the days' inventory on hand.

Accepted Answer

A) True 
 B)False

Question 7

Condensed income statements for Newlon Company are shown below for two years.
   Compute the corrected income before income taxes for 2009 and 2010 assuming that the inventory as of the end of 2009 was mistakenly understated by $13,000.

Accepted Answer

2009 = $34,000 (EI understated

Question 8

Despite its advantages, the just-in-time operating environment produces increased carrying costs for inventory.

Accepted Answer

A) True 
 B)False

Question 9

How does the perpetual inventory system differ from the periodic inventory system in the determination of cost of goods sold?

Accepted Answer

Under the perpetual system, cost of good

Question 10

Marina Sailboats reports income before income taxes of $80,000 during 2010. If beginning inventory was overstated by $7,000 and ending inventory was understated by $8,000, calculate corrected income before income taxes for the year. (Show your work.

Accepted Answer

$95,000 ($

Question 11

Average inventory equals $100,000, and cost of goods sold equals $221,000. Days' inventory on hand equals
A) 165.2 days.
B) 165.2 days.
C) 154.3 days.
D) 188.7 days.

Accepted Answer

The answer of Average inventory equals $100,000, and cost of...

Question 12

When taking a physical inventory under the retail method, it is necessary to know only the quantity of items on hand.

Accepted Answer

A) True 
 B)False

Question 13

Use the following figures (stated in millions of dollars) to compute the inventory
turnover and the days' inventory on hand:
   
a. Inventory turnover = ___________________
b. Days' inventory on hand = ___________________

Accepted Answer

a. 6.3 tim

Question 14

Use this information to answer the following question.   A periodic inventory system is used.
Using the average-cost method, the cost assigned to ending inventory is

Accepted Answer

A)  $4,278. 
B)  $1,518. 
C)  $1,692. 
D)  $1,584. 
A)  $4,278. 
B)  $1,518. 
C)  $1,692. 
D)  $1,584.

Exam 8: Inventories

Goods held on consignment are

Inventory turnover is a measure expressed in terms of a percentage.

Ending merchandise inventory for LIFO will be the same dollar amount under a periodic inventory system as under a perpetual inventory system.

Days' inventory on hand equals 365 divided by

A retail store has beginning inventory of $30,000, purchases of $220,000, sales of $200,000, and a normal gross margin of 25 percent. What is estimated inventory based on these facts and the gross profit method?

The higher the inventory turnover, the higher the days' inventory on hand.

Condensed income statements for Newlon Company are shown below for two years. Compute the corrected income before income taxes for 2009 and 2010 assuming that the inventory as of the end of 2009 was mistakenly understated by $13,000.

Despite its advantages, the just-in-time operating environment produces increased carrying costs for inventory.

How does the perpetual inventory system differ from the periodic inventory system in the determination of cost of goods sold?

Marina Sailboats reports income before income taxes of $80,000 during 2010. If beginning inventory was overstated by $7,000 and ending inventory was understated by $8,000, calculate corrected income before income taxes for the year. (Show your work.

Average inventory equals $100,000, and cost of goods sold equals $221,000. Days' inventory on hand equals A) 165.2 days. B) 165.2 days. C) 154.3 days. D) 188.7 days.

When taking a physical inventory under the retail method, it is necessary to know only the quantity of items on hand.

Use the following figures (stated in millions of dollars) to compute the inventory turnover and the days' inventory on hand: a. Inventory turnover = ___________________ b. Days' inventory on hand = ___________________

Use this information to answer the following question. A periodic inventory system is used. Using the average-cost method, the cost assigned to ending inventory is

Uses of Accounting Information and the Financial Statements

Analyzing Business Transactions

Measuring Business Income

Completing the Accounting Cycle

Financial Reporting and Analysis

The Operating Cycle and Merchandising Operations

Internal Control

Cash and Receivables

Current Liabilities and Fair Value Accounting

Long Term Assets

Contributed Capital

Long Term Liabilities

The Corporate Income Statement and the Statement of Stockholders Equity

The Statement of Cash Flows

Financial Performance Measurement

Partnerships

The Changing Business Environment-A Managers Pers

Cost Concepts and Cost Allocation

Costing Systems: Job Order Costing

Costing Systems Process Costing

Activity-Based Systems-Abm and Lean

Cost Behavior Analysis

The Budgeting Process

Performance Management and Evaluation

Standard Costing and Variance Analysis

Short Run Decision Analysis

Capital Investment Analysis

Filters

Use the following figures (stated in millions of dollars) to compute the inventory turnover and the days' inventory on hand: a. Inventory turnover = _ b. Days' inventory on hand = _