FiltersDone

Question type

Essay

Multiple Choice

Short Answer

True False

Matching

Exam 7: Inventories

Show Answer

Share

---

All types

Filters

Study FlashcardsPractice ExamLearn

Question 51

Multiple Choice

Review LaterAdd Note

Review Later

Merchandise inventory at the end of the year was understated.Which of the following statements correctly states the effect of the error?

A) Net income is understated.
B) Net income is overstated.
C) Cost of merchandise sold is understated.
D) Merchandise inventory reported on the balance sheet is overstated.

E) All of the above
F) A) and B)

Correct Answer

verified

Show Answer

Question 52

Multiple Choice

Review LaterAdd Note

Review Later

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

A) $800
B) $650
C) $750
D) $700

E) None of the above
F) A) and D)

Correct Answer

verified

Show Answer

Question 53

True/False

Review LaterAdd Note

During periods of decreasing costs,the use of the LIFO method of costing inventory will result in a lower amount of net income than would result from the use of the FIFO method.

Matching Match each description to the appropriate document used for inventory control (a-c) . -Authorizes the purchase of inventory from an approved vendor

Match each situation to its impact (a-c) on the current year's net income. -Beginning inventory was understated.

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 September 30.The periodic inventory system is used.Determine the cost of merchandise sold by the (a)FIFO, (b)LIFO,and (c)average cost methods.

Match each description to the appropriate cost flow assumption (a-d) . -Cost flow is assumed to be in the reverse order of costs incurred.

Ending inventory is made up of the oldest purchases when a company uses

Use the information below to answer the following questions. ​ The following lots of a particular commodity were available for sale during the year: ​ The firm uses the periodic system, and there are 20 units of the commodity on hand at the end of the year. ​​ -What is the amount of cost of merchandise sold for the year according to the FIFO method?

Cost flow is in the reverse order in which costs were incurred when using

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

On the basis of the following data,determine the value of the inventory at the lower of cost or market.Apply lower of cost or market to each inventory item.Show your work.

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

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

A consignor who has goods out on consignment with an agent should include the goods in ending inventory even though they are not in the possession of the consignor.

The inventory costing method that reports the earliest costs in ending inventory is

Use the information below to answer the following questions. ​ The following lots of a particular commodity were available for sale during the year: ​ ​ -The firm uses the periodic system,and there are 20 units of the commodity on hand at the end of the year.What is the amount of inventory at the end of the year according to the LIFO method?

If ending inventory for the year is understated,net income for the year is overstated.

Under the periodic inventory system,a physical inventory is taken to determine the cost of the inventory on hand and the cost of the merchandise sold.

The choice of an inventory costing method has no significant impact on the financial statements.