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.

Name: When valuing ending inventory under a perpetual inventory system, the
Uploaded: 2024-03-20T06:32:37.000Z
Channel: Bartleby
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

Business

Accounting

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

See similar textbooks

Related questions

Q: Which Inventory Valuation method gives the highest profit when inventory costs are rising? a.…

A: The inventory can be valued using various methods as FIFO, LIFO and average method. Using FIFO, the…

Q: Match the inventory method with its related characteristic. Assume a period of rising prices in all…

A: The objective of the question is to match the inventory valuation methods (LIFO, FIFO, Weighted…

Q: Q2. Which of the following inventory valuation methods typically results in the highest reported…

A: B) Last - In, First - Out (LIFO)Explanation:LIFO (Last-in, First-out) is typically used during…

Q: A multi-step income statement in a periodic inventory system differs from that in a perpetual…

A: Income statement is the financial statements which is used to see the performance of the entity or…

Q: Question: Which of the following inventory valuation methods assumes that the most recently acquired…

A: The question is asking to identify the inventory valuation method that assumes the most recently…

Q: Explain the four GAAP inventory methods and state which is the most accurate. Explain which will…

A: Inventory Valuation: The valuation of merchandise inventory figure depends on the quantity of…

Q: nventory information for Part 311 of Sunland Corp. discloses the following information for the month…

A: Periodic Inventory :- periodic inventory system is a mechanism for mesuring cost of goods sold and…

Q: Inventory information for Part 311 of Waterway Corp. discloses the following information for the…

A: The question is based on the concept of Cost Accounting. According the standards the valuation of…

Q: Required information [The following information applies to the questions displayed below.] A company…

A: Evaluating Net Realizable Value is essential for proper financial reporting because it prevents…

Q: Compute the inventory turnover. (4) Inventory Turnover Choose Numerator: Choose Denominator:…

A: Inventory Turnover =COGS/Average Inventory Inventory Turnover is Ratio that measure how many times…

Q: The most common approach to implementing the lower of cost or market rule for inventory valuation is…

A: Inventory means the stock of goods in which the businessmen deals. Inventory is always valued at…

Q: answer must be in proper format if that ok i will give upvote

A: The lower-of-cost-or-market (LCM) method is an inventory valuation approach that companies use to…

Q: Under a perpetual inventory system: Multiple Choice Cost of good sold is recorded with a…

A: Inventory management is a method of acquiring, keeping, and selling inventory, which includes both…

Q: Identify which of the following statement is correct for perpetual inventory system? Under the…

A: The objective of the question is to identify the correct statement about the perpetual inventory…

Q: The inventory costinf method that best matches current costs with the current revenues is the 1)…

A: The objective of the question is to identify the inventory costing method that best matches current…

Q: The answer is d, ex In a period of rising prices, the inventory method which tends to report the…

A: Inventory can be valued using various methods -First-in First-Out Method - Under the First-in…

Q: Which U.S. GAAP principle or rule would apply if the net realizable value of acompany’s inventory is…

A: Net realizable value: Net realizable value is the net amount of receivables which a business expects…

Q: 1a The inventory cost flow method that reports the earliest costs in ending inventory is a. LIFO b.…

A: When the earliest costs are represented in the ending inventory it means that the inventory with the…

Q: The original cost of an item of inventory is above its replacement cost. The item s replacement cost…

A: Under the lower of cost or market (LCM) method, inventory is valued at the lower of its original…

Q: Which method results in a balance sheet valuation of inventory method farthest away from its…

A: The method that results in a balance sheet valuation of inventory farthest away from its economic…

Q: inventory as your pase number and adjust the OGS s amount to the required amount to make the Total…

A: Weighted average method is one of the methods of inventory valuation on the basis of which cost of…

Q: Match the term on the left to the appropriate description on the right. v Cost of goods available…

A: Cost of goods available for sale is used for calculating cost of goods sold, COGS=COGAS-Ending…

Q: Weasley's Wizard Wheezes, Inc. (WwW) began its business in January 2019 as a wholesale distributor…

A: FIFO: FIFO stands for First-In, First-Out. As its name suggest, this method assumes that the oldest…

Q: d The records of Cordova Corp. showed the following transactions, in the order given, relating to…

A: Under a periodic inventory system cost of goods sold will be calculated at the end of the period…

Q: Identify which of the following statement is correct for perpetual inventory system? Under the…

A: The objective of the question is to identify the correct statement about the perpetual inventory…

Concept explainers

Inventory Valuation

Before discussing the topic inventory valuation let’s discuss the meaning of inventory. In accounting, inventory is also known as stock. Inventory means all the finished goods, materials, merchandise that a business holds for the purpose of selling it in the market with the motive of earning profit.

Topic Video

Question

When 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-cost
assumption under the periodic inventory system.
O D. last units purchased during the period using the FIFO assumption are allocated to the cost of goods
sold 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.

Expert Solution

This question has been solved!

Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.

This is a popular solution!

SEE SOLUTION Check out a sample Q&A here

Step 1

VIEW

Step 2

VIEW

Trending now

This is a popular solution!

Step by step

Solved in 2 steps

SEE SOLUTION Check out a sample Q&A here

Knowledge Booster

Learn more about

Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.

Similar questions

Identify which of the following statement is correct for perpetual inventory system? When valuing ending inventory under a perpetual inventory system, weighted average cost method requires that a new weighted average unit cost be calculated after every sale. When valuing ending inventory under a perpetual inventory system, valuation using weighted average is the same as the valuation using weighted average under the periodic inventory system. When valuing ending inventory under a perpetual inventory system, oldest units purchased during the period using FIFO are allocated to the cost of goods sold when units are sold. 5 Under the perpetual inventory system, on the purchase of inventory purchase account is debited. 7
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 $34 SAW9 108 19 23 fill in the blank 1 of 1$
The cost of goods sold is based on the oldest purchases under which method of calculating inventory cost? O A. weighted average method O B. first in, first out (FIFO) O C. gross profit method O D. last in, first out (LIFO)
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
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
The inventory valuation method which assumes that the items purchased first are the first items to be sold is called the _____ method. average costLIFO specific identificationFIFO
Which of the following statements about the use of the FIFO assumption is NOT true? a.The FIFO assumption assigns the more recent purchase costs to the balance sheet inventory asset account. b.The FIFO assumption is not affected by the inventory control method. c.In periods of rising prices it produces a higher profit than LIFO. d.The FIFO assumption produces inventory asset values that are based on older purchase costs.