Information on Entity A's inventory of Product A is as follows: Units 3,000 Total Cost P 58,650 Unit Cost Balance at Jan. 1 P19.55 Purchases: Jan. 6 Jan. 26 10,200 21.50 219,300 46,350 2,250 20.60 Sales: Jan. 7 Jan. 31 2,700 7,200

Q: How is Day Sales in Inventory calculated?

A: Inventory turnover ratio: This is a financial measure that is used to evaluate as to how many times…

Q: complete the following table which compares the effects of LIFO,  FIFO and weighted-average…

A: Inventory valuation in costing is done using mainly three methods namely FIFO, LIFO and weighted…

Q: How are days’ sales in inventory calculated, and what does it measure?

A: Numbers of days to sell inventory: This ratio is determined as the number of days a particular…

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: When using a perpetual inventory system and the weighted-average inventory costing method, when does…

A: Perpetual inventory system: The method or system of maintaining, recording, and adjusting the…

Q: Estimate ending inventory and cost of goods sold using the gross profit method.

A: Under gross profit method, calculation of cost of goods sold: Cost of goods sold = Sales* ( 1 -…

Q: In the financial accounting for inventory, what is a cost flow assumption?

A: Accounting for inventories is a subset of accounting that deals with the value of inventoried assets…

Q: What effect does each method used have on the firm’s reportedprofits? On ending inventory levels?

A: Answer: The following is the effect that each method of inventory on firms reported profits:…

Q: Which of the following variations of the reail inventory method would generally result in the lowest…

A: FIFO is a method used to value inventories. In First-In-First-Out (FIFO) method the cost of the…

Q: If inventory is being valued at cost and the price level is steadily rising, which of the three…

A: Inventory can be defined as a form of asset which is held by a business firm for resale purposes.…

Q: In the Perpetual/Periodic Inventory System what are the merchandise inventory and Income summary?…

A: Perpetual inventory: Under perpetual inventory system each transaction for purchase of inventory,…

Q: What is inventory turnover Ratio? Explain its significance.

A: Explain the meaning of inventory turnover ratio and its significance:Inventory turnover ratio:…

Q: Net sales minus cost of good sold is equal to cost of ending inventory.   T/F

A: The ending inventory is the amount of inventory left with business at year end.

Q: What is inventory turnover ratio?

A: Inventory:   It can be described as a good or material that a company holds for the purpose of…

Q: Identify that if prices are rising, which inventory cost flow method will produce the highest amount…

A: solution Identify that if prices are rising, which inventory cost flow method will produce the…

Q: 1. Journalize the adjustment for inventory shrinkage. 2. Journalize the adjustment for estimated…

A: Given: Merchandise inventory = $ 5,200 Inventory on June 30, 2018 = $ 4,900 Amount of Sold…

Q: How do you calculate inventory turnover ratio

A: Inventory turnover ratio indicates how fast a firm converting its inventory into the cost of goods…

Q: How does a company that uses a perpetual inventory system determine the amount of inventory…

A:

Q: Under the lower of cost or market inventory valuation rule, market value of inventory is defined as:…

A: Market value is the price of an item/product prevailing in the market on the given date.

Q: Suppose Fine Chocolates Co. estimates bad debt under the aging method. Before adjusting entries at…

A: “Since you have asked multiple questions, we will solve the first question for you. If you want any…

Q: Determine ending inventory using the dollar-value LIFO inventory method.

A: Dollar-value LIFO method: In this method, the valuation of inventory is calculated on the monetary…

Q: Put the inventory valuation methods in order from which one yields the highest to which one yields…

A: Inventory Valuation is a method of calculating the value of stock at the end of an accounting…

Q: What's the difference between the cost to inventory and the cost of goods sold?

A: Cost of inventory refers to the cost of goods purchased. It is those costs which includes cost of…

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.