Exam 6: Cost of Goods Sold and Inventory

Match the terms with the descriptions provided. a.Average days to sell inventory d.Inventory turnover ratio b.Gross margin e.Freight-in c.Gross profit ratio f.Freight-out -For a given level of sales, the higher the cost of goods sold, the lower this measure.

Parlato Corp. has an inventory turnover rate of 8 times. If its cost of goods sold is $150,000, then the company

Refer to the information provided for Yu Company. Explain the advantages to Yu Company for using the perpetual inventory system. Assume that Yu Company uses a computer system which is linked to its cash registers and that all products have bar codes that are read by bar code readers attached to the cash registers.

MATCHING Match the inventory-related accounts to costs that may be included in inventories for retailers and manufacturers. a. merchandise inventory d. finished goods b. raw materials e. cost of goods sold c. work-in-process -Cost of material, labor, and other production-related costs incurred to date in unfinished goods.

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

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?

Selected account balances are listed below: -Refer to the information provided for Dollar Town. Calculate net sales.

Which of the following statements is false regarding the choice between alternative inventory costing methods?

The inventory of a(n)____________________ consists of three categories: raw materials, work-in-process, and finished goods.

Under a periodic inventory system, the ____________________ account accumulates the cost of inventory acquired during the period.

Re Company prepared the following analysis of its year-end inventory at June 30th: Determine the lower of cost or market value for each product in Re Company's inventory and prepare the journal entry needed at year-end to value the inventory at LCM.

Refer to the information provided for Pham Enterprises. What is the company's inventory turnover ratio for 2013?

Selected account balances are listed below: -Refer to the information provided for Dollar Town. Calculate the company's gross margin.

Cost of goods sold is equal to

Regan Company Regan Company reported net income of $95,000 for 2013. Early in 2014, the company discovered that its 2013 ending inventory was overstated by $5,000. -Refer to the information provided for Regan Company. Determine the effects of the inventory errors for 2013.

If cost of goods sold does not equal the cost of merchandise purchased during the period, an adjustment must be made to correct the error.

MATCHING Match the inventory-related accounts to costs that may be included in inventories for retailers and manufacturers. a. merchandise inventory d. finished goods b. raw materials e. cost of goods sold c. work-in-process -Costs of completed items that have been sold to customers.

Selected account balances are listed below: -Refer to the information provided for Aaron Corporation. Calculate net income.

Echols Company sells merchandise on credit. If a customer pays its balance due after the discount period has passed, what is the effect of the payment on seller's accounting equation?

Under the periodic inventory system, Net purchases = Purchases + ______________ - Purchase Discounts - Purchase Returns and Allowances.