Exam 6: Cost Of Goods Sold and Inventory

Klump Co. uses a perpetual inventory system and had the following inventory transactions for the month of June.June -Refer to the information provided for Klump Co. If the company uses the (moving) Average Cost inventory costing method, ending inventory at June 30th is:

Transportation-in is

Match the terms with the descriptions provided. -Merchandise held for sale in the normal course of business.

Match the terms with the descriptions related to merchandise sales and purchases. -Recorded cash sales for the day.

Which of the following types of inventory accounts would be used by a wholesaler or retailer?

A loss in inventory value caused by application of the lower of cost or market (LCM) rule is recorded in a "Loss from Impairment" account.

Buyer Company purchased a large shipment of luggage from Seller Company on credit near the end of its accounting period. Seller Company shipped the luggage in January and Buyer Company received the luggage in February. Assume that Buyer Company's accounting period ends on January 31st, while Seller Company's accounting period ends on May 31st. Answer each independent question: A)If the luggage was shipped FOB destination, who will pay the freight costs? B)If the luggage was shipped FOB destination, when should Buyer Company record the purchase? C)If the luggage was shipped FOB shipping point, who will pay the freight costs? D)If the luggage was shipped FOB shipping point, when should Buyer Company record the purchase? E)Under what shipping terms would Buyer Company include the luggage as part of inventory on its January 31st balance sheet?

Lowery Company uses a perpetual inventory system. The following information is available for the month of March: -Refer to the information provided for Lowery Company. If the company uses the FIFO inventory costing method, how much is ending inventory at March 31st?

Eli Company sells novelty items and offers terms of 1/10, n/30 to credit customers. One customer, Faulkner, Inc., purchased 100 Sweet-16 party decor packs with a list price of $20 each on March 5, 2019. -Refer to the information provided for Eli Company. If the customer pays the invoice on March 31, 2013, how much sales discount will Eli Company recognize?

Selected data from the financial statements for Tarpley & Underwood are presented below: -Refer to the information presented for Tarpley & Underwood. What is the gross profit ratio?

For which type of merchandise would a company most likely use the specific identification method of inventory costing?

Lemke Corp. uses a perpetual inventory system with a (moving) weighted average inventory costing method. The following information is available for the month of April: -Refer to the information provided for Lemke Corp. How much is ending inventory on April 30th?

Match the terms with the descriptions related to merchandise sales and purchases. -Collected cash from a customer for payment within the discount period.

Match the costs that might be included as part of the cost of inventory to the listed accounting treatment. (Choices may be used more than once.) -Freight costs incurred by the buyer to ship goods to its place of business.

Which inventory costing method might allow a company to manipulate income by making significant inventory purchases at year end?

Klinc Company uses a perpetual inventory system and had the following inventory transactions for the month of June: The June 30th inventory included 45 units from the June 4th purchase and 45 units from the June 10th purchase. -Refer to the information provided for Klinc Company. What is the cost of ending inventory at June 30th under the specific identification method?

Match the terms with the descriptions provided. -Companies such as advertising agencies and auto repair shops.

The following selected financial information is available for Pham Enterprises for the year ended December 31: -Refer to the information provided for Pham Enterprises. What is the company's average-days-to-sell inventory measure?

Lemke Corp. uses a perpetual inventory system with a (moving) weighted average inventory costing method. The following information is available for the month of April: -Refer to the information provided for Lemke Corp. How much is the cost of goods sold for the units sold on April 15th?

The following selected financial information is available for Pham Enterprises for the year ended December 31: -Refer to the information provided for Pham Enterprises. What is the company's inventory turnover ratio for the year ended December 31?