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404. The use of discount lost account implies that cost of a purchased inventory tem the" A list price of the item. B. invoice price of the item. C. invoice price less the purchase discount taken on the item invoice price less the purchase discount not taken on the itere D.

404. The use of discount lost account implies that cost of a purchased inventory tem the" A list price of the item. B. invoice price of the item. C. invoice price less the purchase discount taken on the item invoice price less the purchase discount not taken on the itere D.

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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one entry records the purchase of merchandise and tle other records the one entry updated the subsidiary ledger and the other updates the general D. forecasts of future operating results that will be used as basis for the 409. In a perpetual inventory system, two entries are normally nade to record each 404. The use of discount lost account implies that cost of a purchased inventory tem is 405. In a manufacturing company, the "just-in-time" concept of inventory managemen the A. list price of the item. B. invoice price of the item. C. invoice price less the purchase discount taken on the iteirn D. invoice price less the purchase discount not taken on the item is best illustrated by A. setting finished products before they go out of style, B. An automated factory with reduced production time below that et companies in the industry C. completing the manufacturing process just before the deadline established the customer. D. receiving deliveries of materials from suppliers just before the materiale s used in the production process. 406. When a periodic inventory system is used A. two entries must be made when goods are purchased. B. cost of goods sold is a residual amount, rather than an account. C. ending inventory is treated as an expense and beginning itventory is treated as an asset. D. Purchases' account is not used; all inventory purchase enties are debited to inventory account. 407. Which of the following is a characteristic of a perpetual inventorysystem? A. Inventory records are not kept for every item. B. Cost of goods sold is recorded with each sale. C. Inventory purchases are debuted to Purchases account. D. Cost of goods sold is determined as the amount of purchases less the change in inventory. 408. In a perpetual inventory system, an inventory flow assumption s used primarily t determining which costs to use in A recording sales revenue. B. recording the cost of goods sold. C. recording purchases and inventory. production budget. sales transaction, A. sale. B. ledger,
Transcribed Image Text:one entry records the purchase of merchandise and tle other records the one entry updated the subsidiary ledger and the other updates the general D. forecasts of future operating results that will be used as basis for the 409. In a perpetual inventory system, two entries are normally nade to record each 404. The use of discount lost account implies that cost of a purchased inventory tem is 405. In a manufacturing company, the "just-in-time" concept of inventory managemen the A. list price of the item. B. invoice price of the item. C. invoice price less the purchase discount taken on the iteirn D. invoice price less the purchase discount not taken on the item is best illustrated by A. setting finished products before they go out of style, B. An automated factory with reduced production time below that et companies in the industry C. completing the manufacturing process just before the deadline established the customer. D. receiving deliveries of materials from suppliers just before the materiale s used in the production process. 406. When a periodic inventory system is used A. two entries must be made when goods are purchased. B. cost of goods sold is a residual amount, rather than an account. C. ending inventory is treated as an expense and beginning itventory is treated as an asset. D. Purchases' account is not used; all inventory purchase enties are debited to inventory account. 407. Which of the following is a characteristic of a perpetual inventorysystem? A. Inventory records are not kept for every item. B. Cost of goods sold is recorded with each sale. C. Inventory purchases are debuted to Purchases account. D. Cost of goods sold is determined as the amount of purchases less the change in inventory. 408. In a perpetual inventory system, an inventory flow assumption s used primarily t determining which costs to use in A recording sales revenue. B. recording the cost of goods sold. C. recording purchases and inventory. production budget. sales transaction, A. sale. B. ledger,
A. if purchase costs are rising. B. if purchase costs are falling. C. if each item in the inventory is unique. D. for a large inventory of identical low-priced items.. 417. The costing of inventory must be deferred until the end of the accounting period under which of the following method of inventory valuation? A. FIFO petpetual. B. LIFO perpetual. C. Moving average. D. Weighted average. 418. The weighted-average inventory costing method is particularly suitable to inventory where A. homogeneous products are mixed together. B. dissimilar products are stored in separate locations. C. the entily carries stocks of raw materials, work-in-profess and finished goods. D. goods have distinct use-by dates and the goods produced first must be sold earliest 419. A company's inventory cost was lower in FIFO that is would have been using LIFO. Assuming no beginning inventory, in what direction did the cost of purchases move during the period? A. Down B. Steady C. Up D. Cannot be determined 420. During a period of steadily rising prices, which of the following methods pf meaşuring the costs of goods sold is likely to result in reporting the highest gross profit? A. Average cost. B. FIFO C. LIFO D. Specific identification. 421. Losses arising from firm and non-cancellable purchase commitments of inventory items, if material, should be A. ignared. B. disclosed in the notes. C. charged to retained earnings. D. recognized in the accounts by debiting loss on purchase commitments and crediting estimated liability for loss on purchase commitments.
Transcribed Image Text:A. if purchase costs are rising. B. if purchase costs are falling. C. if each item in the inventory is unique. D. for a large inventory of identical low-priced items.. 417. The costing of inventory must be deferred until the end of the accounting period under which of the following method of inventory valuation? A. FIFO petpetual. B. LIFO perpetual. C. Moving average. D. Weighted average. 418. The weighted-average inventory costing method is particularly suitable to inventory where A. homogeneous products are mixed together. B. dissimilar products are stored in separate locations. C. the entily carries stocks of raw materials, work-in-profess and finished goods. D. goods have distinct use-by dates and the goods produced first must be sold earliest 419. A company's inventory cost was lower in FIFO that is would have been using LIFO. Assuming no beginning inventory, in what direction did the cost of purchases move during the period? A. Down B. Steady C. Up D. Cannot be determined 420. During a period of steadily rising prices, which of the following methods pf meaşuring the costs of goods sold is likely to result in reporting the highest gross profit? A. Average cost. B. FIFO C. LIFO D. Specific identification. 421. Losses arising from firm and non-cancellable purchase commitments of inventory items, if material, should be A. ignared. B. disclosed in the notes. C. charged to retained earnings. D. recognized in the accounts by debiting loss on purchase commitments and crediting estimated liability for loss on purchase commitments.
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