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Exam 7: Inventories

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Question 61

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Use of the retail inventory method requires taking a physical count of inventory.

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Question 62

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The specific identification inventory method should be used when the inventory consists of identical, low cost units that are purchased and sold frequently.

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Question 63

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During times of rising prices, which of the following is not an accurate statement?

Match the following documents used for inventory control:

Describe three inventory cost flow assumptions and how they impact the financial statements.

Beginning inventory, purchases and sales data for widgets are as follows: Complete the inventory cost card assuming the business maintains a perpetual inventory system and calculates the cost of merchandise sold and ending inventory using FIFO.

The units of Product Green-2 available for sale during the year were as follows: There are 17 units of the product in the physical inventory at Sep 30. The periodic inventory system is used. Determine the cost of merchandise sold by (a) FIFO, (b) LIFO, and (c) average cost methods.

If the cost of an item of inventory is $60 and the current replacement cost is $75, the amount included in inventory according to the lower of cost or market is

When using a perpetual inventory system, the journal entry to record the cost of merchandise sold is:

Control of inventory should begin as soon as the inventory is received. Which of the following internal control steps is not done to meet this goal?

Addison, Inc. uses a perpetual inventory system. The following is information about one inventory item for the month of September: If Addison uses LIFO, the cost of the ending merchandise inventory on September 30 is

Basic inventory data for April 30 are presented below for a business that employs the lower of cost or market basis of inventory valuation.

On the basis of the following data, estimate the cost of the merchandise inventory at March 31 by the retail method:

Fill in the missing amounts from the chart below regarding the calculation of Bean Corporation's estimated inventory using the retail method of estimation.

The average cost inventory method is the rarely used with a perpetual inventory system.

For the year ended December 31, 2014 Depot Max's cost of merchandise sold was $56,900. Inventory at the beginning of the year was $6,540. Ending inventory was $7,250. Compute Depot Max's inventory turnover for the year.

Beginning inventory, purchases and sales data for tennis rackets are as follows: Complete the inventory cost card assuming the business maintains a perpetual inventory system and calculates the cost of merchandise sold and ending inventory using LIFO.

During periods of increasing costs, an advantage of the LIFO inventory cost method is that it matches more recent costs against current revenues.

During August, the first month of the fiscal year, sales totaled $875,000 and the cost of merchandise available for sale totaled $700,000. Estimate the cost of the merchandise inventory as of August 31, based on an estimated gross profit rate of 45%.

Beginning inventory, purchases, and sales for Product - Weld TM are as follows: Assuming a perpetual inventory system and the last-in, first-out method, determine (a) the cost of the merchandise sold for the September 30 sale and