Exam 5: Accounting for Inventories

During a period of declining prices,a company would report a lower gross margin using the FIFO cost flow method than with LIFO.

Singleton Company's perpetual inventory records included the following information: -If Singleton uses the FIFO cost flow method,its cost of goods sold would be $4,490.

Tetra Co.uses the perpetual inventory system and a FIFO cost flow method.On January 1,the company purchased 2,000 units of inventory that cost $4.00 each.On January 12,the company purchased an additional 3,000 units of inventory at a cost of $4.20 each.On January 20,Tetra Company sold 4,000 units of inventory.Which of the following entries would be required to recognize the cost of goods sold on that date?

During a period of rising inventory prices,the amount of ending inventory reported on the balance sheet will be lower using the LIFO cost flow method than with FIFO.

The inventory records for Radford Co.reflected the following: -What is the amount of gross margin assuming the weighted-average inventory cost flow method?

Melbourne Company uses the perpetual inventory system and LIFO cost flow method.Melbourne purchased 500 units of inventory that cost $4.00 each.At a later date,the company purchased an additional 600 units of inventory that cost $5.00 each.If the company sells 800 units of inventory,what amount of ending inventory will appear on a balance sheet prepared immediately after the sale?