Exam 5: Reporting and Analyzing Inventories

A company reported the following information regarding its inventory. Beginning inventory: cost is $70,000; retail is $130,000. Net purchases: cost is $65,000; retail is $120,000. Sales at retail: $145,000. The year-end inventory showed $105,000 worth of merchandise available at retail prices. What is the cost of the ending inventory?

Mason Company has the following per unit original costs and replacement costs for its inventory. The company applies LCM to individual items of product: Part A: 20 units with a cost of $3 and replacement cost of $3.50. Part B: 30 units with a cost of $9 and replacement cost of $8.50. Part C: 60 units with a cost of $8 and replacement cost of $7.00. When applying the lower of cost or market method, the total value of this company's ending inventory must be reported as:

A company had 22 units at a cost of $26 each in inventory on March 1. On March 2, the company purchased 27 units at $27 each. On March 6, the company purchased 23 units at $28 each. On March 8, the company sold 52 units for $71 each. Given this information, determine the cost of the 20 units remaining in inventory after the March 8 sale using the LIFO periodic inventory method.

A company had 14 units of inventory at a cost of $18 each on July 1. On July 2, the company purchased 19 units at $19 each. On July 6, the company purchased 15 units at $20 each. On July 8, the company sold 36 units for $63 each. Given this information, determine the cost of the 36 units sold using the LIFO periodic inventory method.

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

Kalamazoo Corporation uses the periodic inventory system and has provided the following information about one of their inventory items: During the year, 925 units were sold. What was the cost of goods sold using the FIFO cost flow assumption?

A company has inventory of 10 units at a cost of $10 each on June 1. On June 3, they purchased 20 units at $12 each. 12 units are sold on June 5. Using the FIFO perpetual inventory method, what is the cost of the 12 units that were sold?

During a period of steadily rising costs, the inventory valuation method that yields the lowest reported net income is:

A company uses a weighted average perpetual inventory system. August 2: 10 units were purchased at $12 per unit. August 18: 15 units were purchased at $15 per unit. August 29: 20 units were sold. August 31: 14 units were purchased at $16 per unit. What is the per-unit value of ending inventory on August 31?

What types of costs are assigned to the merchandise inventory account?

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

Given the following information, determine the cost of ending inventory at December 31 using the weighted average perpetual inventory method. December 2: 5 units were purchased at $7 per unit. December 9: 10 units were purchased at $9.40 per unit. December 11: 12 units were sold at $35 per unit. December 15: 20 units were purchased at $10.15 per unit. December 22: 18 units were sold at $35 per unit.

Days' sales in inventory is calculated as:

Given the following information, determine the cost of goods sold at December 31 using the LIFO periodic inventory method: December 2: 5 units were purchased at $7 per unit. December 9: 10 units were purchased at $9.40 per unit. December 11: 12 units were sold at $35 per unit. December 15: 20 units were purchased at $10.15 per unit. December 22: 18 units were sold at $35 per unit.

An understatement of ending inventory will cause an understatement of assets and equity on the balance sheet.

Which inventory valuation method assigns a value to the inventory on the balance sheet that approximates current cost and also mimics the actual flow of goods for most businesses?

Given the following information, determine the cost of goods sold at December 31 using the LIFO perpetual inventory method. December 2: 5 units were purchased at $7 per unit. December 9: 10 units were purchased at $9.40 per unit. December 11: 12 units were sold at $35 per unit. December 15: 20 units were purchased at $10.15 per unit. December 22: 18 units were sold at $35 per unit.

Acme-Jones Corporation uses a weighted average perpetual inventory system. August 2, 10 units were purchased at $12 per unit. August 18, 15 units were purchased at $14 per unit. August 29, 12 units were sold. What was the amount of the cost of goods sold for this sale?

Use the following information to estimate the third quarter ending inventory under the gross profit method. This company's gross profit ratio is 20%. Third quarter beginning inventory: $54,000 Net sales for third quarter: $85,000 Net purchases for third quarter: $21,000

A merchandiser that uses a periodic inventory system made the following cash purchases and sales during the year. There was no beginning inventory. The company has a calendar year-end and uses the weighted average inventory valuation method. Calculate the ending inventory balance and the cost of goods sold for the year. (Round the weighted average cost per unit to three decimal points; round the ending inventory and cost of goods sold to the nearest whole dollar.)