Exam 6: Receivables and Inventories

Use the following data to calculate the cost of ending inventory using the LIFO method. 15 units at \ 20 each Beginning Inventory September 1 20 units at \ 25 each Purchase September 10 25 units at \ 28 each Purchase September 20 30 units Ending Inventory September 30

Using the lower-of-cost-or-market method of inventory valuation, what should the total inventory value be for the following items: Item Total market price Total cost price Unit market price Unit cost price Inventory Quantity A 900 \ 1,000 \ 4.50 \ 5 200 B 500 400 5.00 4 100 C 325 350 5.50 7 50

The party promising to pay a note at maturity is the payee.

The interest at 6%, on a 60-day note for $5,000 is $50. (Assume 360 days in a year)

The maturity value of a 12%, 60-day note for $5,000 is $5,100. (Assume 360 days in a year)

The due date of a 60-day note dated July 10 is September 9.

A 60-day, 12% note for $15,000 dated May 1 is received from a customer on account. The maturity value of the note is (Assume 360 days in a year):

The two methods of accounting for uncollectible receivables are the allowance method and the:

The presentation of net accounts receivable on the balance sheet will be most accurate under the

Indicate the section of the balance sheet (current assets, fixed assets, investments, current liabilities, long-term liabilities, stockholders' equity) in which each of the following is reported: (a)Note receivable due in 3 years (b)Note receivable due in 90 days (c)Allowance for doubtfil accounts

(a) If the interest on a note is $800, the interest rate is 6%, and the time is 60 days, what is the principal? (Assume 360 days in a year) (b) If the principal of a note is $24,000, the interest is $600, and the time is 60 days, whatis the interest rte? (Assume 360 days in a year)

The two most widely used methods for determining the cost of inventory are:

The inventory costing method that assigns the most recent costs to cost of good sold is:

If the cost of an item of inventory is $70, the current replacement cost is $65, and the sales price is $85, the amount included in inventory according to the lower-of-cost-or-market method is:

Under which method of inventory costing is the ending inventory assumed to be composed of the most recent costs?

The due date of a 90-day note dated July 5 is:

Inventories of merchandising and manufacturing businesses are reported as current assets on the balance sheet.

After the accounts are adjusted and closed at the end of the fiscal year, Accounts Receivable has a balance of $500,000 and Allowance for Doubtful Accounts has a balance of $25,000. What is the net realizable value of the accounts receivable?

The maturity value of a 12%, 60-day note for $1,000 is $1,020. (Assume 360 days in a year)

The FIFO method of costing inventory is based on the assumption that costs should be charged against revenues in the reverse order in which they were incurred.