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51.              Which of the following inventory methods when used for

Question : 51.              Which of the following inventory methods when used for : 1410875

 

 

51.              Which of the following inventory methods when used for income tax purposes must also be used for reporting purposes?

a.

Specific identification

b.

LIFO

c.

FIFO

d.

Average-cost

 

 

 

52.              Use this inventory information for the month of September to answer the following question.

 

 

 

Sept.

1

 

Beginning inventory

10 units @ $120

 

 

5

 

Purchase

60 units @ $112

 

 

14

 

Sale

40 units

 

 

21

 

Purchase

30 units @ $116

 

 

30

 

Sale

28 units

 

Assuming that a perpetual inventory system is used, what is ending inventory on a FIFO basis?

a.

$3,704

b.

$7,696

c.

More information is needed.

d.

$3,664

 

 

 

53.              Use this inventory information for the month of September to answer the following question.

 

 

Sept.

1

 

Beginning inventory

10 units @ $120

 

 

5

 

Purchase

60 units @ $112

 

 

14

 

Sale

40 units

 

 

21

 

Purchase

30 units @ $116

 

 

30

 

Sale

28 units

 

Assuming that a perpetual inventory system is used, what is ending inventory (rounded) under the average-cost method?

a.

$3,666

b.

$3,712

c.

$3,208

d.

$7,734

 

 

 

54.              Use this inventory information for the month of March to answer the following questions.

 

 

Mar.

1

 

Beginning inventory

20 units @ $76

 

 

7

 

Purchase

70 units @ $80

 

 

18

 

Sale

25 units

 

 

22

 

Purchase

10 units @ $88

 

 

29

 

Sale

40 units

 

Assuming that a perpetual inventory system is used, what is ending inventory on a LIFO basis?

a.

More information is needed.

b.

$5,120

c.

$2,720

d.

$2,880

 

 

 

55.              Use this inventory information for the month of March to answer the following question.

 

 

Mar.

1

 

Beginning inventory

20 units @ $76

 

 

7

 

Purchase

70 units @ $80

 

 

18

 

Sale

25 units

 

 

22

 

Purchase

10 units @ $88

 

 

29

 

Sale

40 units

 

Assuming that a perpetual inventory system is used, what is cost of goods sold (rounded) under the average-cost method?

a.

$6,020

b.

$3,210

c.

$5,190

d.

$2,810

 

 

 

56.              Which of the following companies would be most likely to use the retail method?

a.

A dealer in heavy machinery

b.

A TV repair company

c.

A women's dress shop

d.

A farm supply company

 

 

 

57.              In which of the following cases would the gross profit method most likely be used?

a.

In a company with good accounting records

b.

In applying the average-cost method

c.

In estimating the market value of inventory for application of the lower-of-cost-or-market rule

d.

In estimating an inventory loss from fire

 

 

 

58.              When applying the retail method, which of the following would not be a component of the cost-to-retail percentage?

a.

Purchases

b.

Beginning inventory

c.

Sales

d.

Freight-in

 

 

 

59.              Which of the following methods generally is used to determine the loss when inventory is destroyed or stolen?

a.

Retail method

b.

FIFO

c.

LIFO

d.

Gross profit method

 

 

 

60.              A retail company has goods available for sale of $500,000 at retail and $200,000 at cost and ending inventory of $57,000 at retail. What is the estimated cost of goods sold?

a.

$143,000

b.

$188,600

c.

$177,200

d.

$165,800

 

 

 

61.              A company has cost of goods available for sale of $250,000, sales of $305,000, and a gross profit percentage of 30 percent. Using the gross profit method, what is the ending inventory?

a.

$95,000

b.

$50,000

c.

$36,500

d.

$158,500

 

 

 

62.              A retail store has goods available for sale of $2 million at retail and $1,100,000 at cost, and ending inventory of $160,000 at retail. What is the estimated cost of ending inventory?

a.

$128,000

b.

$160,000

c.

$110,000

d.

$88,000

 

 

 

63.              A retail store prices its goods to achieve a gross margin of 30 percent. Up to the date of a fire that destroyed the store's inventory, sales were $200,000 and cost of goods available for sale was $150,000. The estimated cost of the inventory destroyed is

a.

$10,000.

b.

$35,000.

c.

$60,000.

d.

$50,000.

 

 

 

64.              A retail store has beginning inventory of $30,000, purchases of $220,000, sales of $200,000, and a normal gross margin of 25 percent. What is estimated inventory based on these facts and the gross profit method?

a.

$50,000

b.

$150,000

c.

$100,000

d.

$200,000

 

 

 

65.              A company has goods available for sale of $250,000 at retail and $175,000 at cost. It also had sales of $210,000 for the period. What is the estimated cost of ending inventory, using the retail method?

a.

$38,000

b.

$28,000

c.

$40,000

d.

$63,000

 

 

 

 

 

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