When valuing ending inventory under a perpetual inventory system, theO A. valuation using the FIFO assumption is the same as under the periodic inventory system.O B. moving average requires that a new average be computed after every sale.O C. valuation using the average-cost assumption is the same as the valuation using the average-costassumption under the periodic inventory system.O D. last units purchased during the period using the FIFO assumption are allocated to the cost of goodssold when units are sold. Which of the following statements is correct with respect to inventories?A. The FIFO method assumes that the costs of the earliest goods acquired are the last to be sold.B. Under FIFO, the ending inventory is based on the latest units purchased.OC. It is generally good business management to sell the most recently acquired goods first.O D. FIFO seldom coincides with the actual physical flow of inventory.

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Description: When valuing ending inventory under a perpetual inventory system, theO A. valuation using the FIFO assumption is the same as under the periodic inventory system.O B. moving average requires that a new average be computed after every sale.O C. valuat

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hen valuing ending inventory under a perpetual inventory system, the O A. valuation using the FIFO assumption is the same as under the periodic inventory system. O B. moving average requires that a new average be computed after every sale. O C. valuation using the average-cost assumption is the same as the valuation using the average-

hen valuing ending inventory under a perpetual inventory system, the O A. valuation using the FIFO assumption is the same as under the periodic inventory system. O B. moving average requires that a new average be computed after every sale. O C. valuation using the average-cost assumption is the same as the valuation using the average-

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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47-Under which method of inventory valuation, do the older goods are issued out first? a. Last In First Out (LIFO) b. Weighted average method c. Average price method d. First In First Out (FIFO)
Under which inventory cost flow assumption is the cost of the most recent purchase matched first with sales revenues? Select one: A. FIFO B. Weighted average cost C. LIFO
d The records of Cordova Corp. showed the following transactions, in the order given, relating to the major inventory item: Required: Complete the following schedule for each independent assumption. (Round unit costs to the nearest cent.) a. 1. Inventory 2. Purchase 3. Sale (at $15.20) 4. Purchase 5. Sale (at $15.20) 6. Purchase 7. Sale (at $18.20) 8. Purchase Independent Assumptions FIFO Weighted average, periodic inventory system Moving average, perpetual inventory system b. Unit Units Cost 5,600 $7.00 11,200 7.30 7,900 10,200 7.60 16,800 18,800 7.76 16,800 11,200 7.90 C. $ Ending Inventory 121,848 121,675 X 121,676 Units and Amounts Cost of Goods Sold $ 311,000 311,064 311,328 $ Gross Margin 370,200 370,136 X 369,872
When identical units of an item are purchased at different costs a. an inventory cost flow method must be used under a periodic inventory system only. b. an inventory cost flow method is not used under either a perpetual or a periodic inventory system. can inventory cost flow method must be used under both a perpetual and a periodic inventory system. d. an inventory cost flow method must be used under a perpetual inventory system only.
An increasing inventory turnover ratioa. Indicates a longer time span between the ordering andreceiving of inventory.b. Indicates a shorter time span between the ordering andreceiving of inventory.c. Indicates a shorter time span between the purchase andsale of inventory.d. Indicates a longer time span between the purchase andsale of inventory.
31- Under which method of inventory valuation, do the older goods are issued out first? a. First In First Out (FIFO) b. Weighted average method c. Last In First Out (LIFO) d. Average price method
The costs of ending inventory is similar under both periodic and perpetual inventory system if _________________ method is used. a. first-in, first-out (FIFO) b. standard cost c. weighted average d. last-in, first-out (LIFO)
When is ending inventory written down below its acquisition cost on the balance sheet? Select one: A. When units are damaged, physically deteriorated, or obsolete B. When the inventory's replacement cost exceeds its acquisition cost C. When the inventory's replacement cost is below its acquisition cost D. Both A and C
Lower-of-cost-or-market method On the basis of the following data, determine the value of the inventory at the lower-of-cost-or-market by applying lower-of-cost-or-market to each inventory item, as shown in Exhibit 10. Commodity InventoryQuantity Cost perUnit Market Value per Unit(Net Realizable Value) JFW1 53 $39 $34 SAW9 108 19 23 fill in the blank 1 of 1$
Lower-of-cost-or-market method On the basis of the following data, determine the value of the inventory at the lower-of-cost-or-market by applying lower-of-cost-or-market to each inventory item, as shown in Exhibit 10. Commodity InventoryQuantity Cost perUnit Market Value per Unit(Net Realizable Value) JFW1 78 $58 $55 SAW9 148 28 33
Inventory cost flow assumptions address accounting issues except when a.identical units of merchandise are acquired at different unit costs during the period. b.an item is sold and it is necessary to determine its cost. c.both of these choices address inventory accounting issues. d.neither of these choices addresses inventory accounting issues.
Question: Which of the following inventory valuation methods typically results in higher ending inventory value during periods of rising prices? A) FIFO (First-In-First-Out) method B) LIFO (Last-In-First-Out) method C) Weighted Average method D) Specific Identification method