FiltersDone

Question type

Essay

Multiple Choice

Short Answer

True False

Matching

Exam 6: Inventory and Cost of Goods Sold

Show Answer

Share

---

All types

Filters

Study Flashcards

Question 91

Multiple Choice

Review LaterAdd Note

Review Later

The following information pertains to Julia & Company: March 1 Beginning inventory $= 30$ units $@ \$ 5$ March3 Purchased15 units@\$4 March 9 Sold 25 units $@ \$ 8$ What's the ending balance of inventory for Julia & Company assuming that it uses FIFO?

A) $125
B) $100
C) $110
D) $85

E) A) and D)
F) B) and D)

Correct Answer

verified

Show Answer

Question 92

Multiple Choice

Review LaterAdd Note

Review Later

Bill Inc.'s correct ending balance for the inventory account at the end of 2012 should be $5,000, but the company incorrectly stated it as $3,000. In 2013, Bill correctly recorded its ending balance of the inventory account. Which one of the following is true?

A) Gross profit is overstated by $2,000 in 2012.
B) Retained earnings are understated by $2,000 in 2013.
C) Gross profit is overstated by $2,000 in 2013.
D) Cost of goods sold is understated by $2,000 in 2012.

E) All of the above
F) None of the above

Correct Answer

verified

Show Answer

Question 93

Multiple Choice

Review LaterAdd Note

Cost of goods sold equals:

Listed below are ten terms followed by a list of phrases that describe or characterize five of the terms. Match each phrase with the best term placing the letter designating the term in the space provided. Terms: -_____ Cost flow assumption that assumes last units purchased are sold first.

The following information pertains to Julia & Company: March 1 Beginning inventory $= 30$ units $@ \$ 5$ March 3 Purchased15 units @ \$4 March 9 Sold 25 units $@ \$ 8$ What is the cost of goods sold for Julia & Company assuming it uses LIFO?

A company overstated its ending inventory balance by $6,000 in 2012. What impact will this error have on cost of goods sold and gross profit in 2012 and 2013?

The gross profit ratio measures the amount by which the sale price of inventory exceeds its cost per dollar of sales.

Using the weighted-average cost method, the average cost of inventory is calculated as the average unit cost of inventory purchased during the year.

Listed below are four terms followed by a list of phrases that describe or characterize the terms. Match each phrase with the best term placing the letter designating the term in the space provided. Terms: -_____ Requires a year-end adjustment for inventory.

During periods of rising costs, FIFO generally results in a higher ending inventory balance.

When inventory costs are rising, __________ generally results in a higher amount of reported net income.

The LIFO conformity rule requires a company that uses LIFO for tax reporting to use FIFO for financial reporting.

Overstating ending inventory in the current year causes net income in the current year to be overstated.

For most companies, actual physical flow of their inventory follows LIFO.

Listed below are five terms followed by a list of phrases that describe or characterize the terms. Match each phrase with the best term placing the letter designating the term in the space provided. Terms: -_____ Companies that purchase inventories that are primarily in finished form for resale to customers.

Baker Fine Foods has beginning inventory for the year of $12,000. During the year, Baker purchases inventory for $150,000 and ends the year with $20,000 of inventory. Baker will report cost of goods sold equal to:

In a perpetual inventory system, the purchase of inventory is debited to:

Good, Inc. sold inventory for $1,200 that was purchased for $700. Good records which of the following when it sells inventory using a perpetual inventory system?

The following information relates to inventory for Shoeless Joe Inc. $\begin{array} { l l c c } \text { Date } & & \underline { \text { Quantity } } & \underline { \text { Price } } \\\text { March 1 } & \text { Beginning Inventory } & 20 & \$ 2 \\\text { March 7 } & \text { Purchase } & 15 & 3 \\\text { March 11 } & \text { Sale } & 25 & 7 \\\text { March 12 } & \text { Purchase } & 20 & 4\end{array}$ At what amount would Shoeless report gross profit using LIFO cost flow assumptions?

Listed below are ten terms followed by a list of phrases that describe or characterize five of the terms. Match each phrase with the best term placing the letter designating the term in the space provided. Terms: -_____ Cost of inventory sold during the period.