Golden Oak Antique Shop has the following account balances at the end of the current accounting period. \[\begin{array} { | l | r | } \hline \text { Beginning inventory } & \$ 73,250 \\ \hline \text { Net purchases } & 57,650 \\ \hline \text { Net sales revenue } & 85,500 \\ \hline \end{array}\] A normal gross profit for the company is $45%.What is the company's estimated cost of goods sold for the accounting period?

A) $92,425 B) $38,475 C) $47,025 D) $83,875 A) $92,425 B) $38,475 C) $47,025 D) $83,875

Santa Fe Tile Company had the following inventory purchases and sales during the month of May.The company uses the periodic inventory method. \[\begin{array} { | c | c | c | c | c | c | c | } \hline & \text { Purchases } & & & \text { Sales } & & \\ \hline \text { Date } & \text { Units } & \text { Unit Cost } & \text { Total } & \text { Units } & \text { Unit Price } & \text { Total } \\ \hline \text { May 1 } & 100 & \$ 4 & \$ 400 & & & \\ \hline 5 & 200 & 5 & 1,000 & & & \\ \hline 10 & & & & 100 & \$ 10 & \$ 1,000 \\ \hline 15 & 100 & 6 & 600 & & & \\ \hline 20 & 150 & 7 & 1,050 & & & \\ \hline 25 & & & & 200 & 11 & \$ 2,200 \\ \hline 30 & 160 & 8 & 1,280 & & & \\ \hline & 710 & & \$ 4,330 & 300 & & \$ 3,200 \\ \hline \end{array}\] - If Santa Fe uses LIFO costing,how much was the Ending inventory balance?

A) $2.980 B) $3,120 C) $2,480 D) $2,930 A) $2.980 B) $3,120 C) $2,480 D) $2,930

Williams Company had the following balances and transactions during 2013. \[\begin{array} { | l | l | } \hline \text { Beginning inventory } & 10 \text { units at } \$ 70 \\ \hline \text { June } 10 & \text { Purchased } 20 \text { units at } \$ 80 \\ \hline \text { December } 30 & \text { Sold } 15 \text { units } \\ \hline \text { December } 31 & \text { Replacement cost } \$ 60 \\ \hline \end{array}\] What would the company's inventory amount be on the December 31,2013 balance sheet if the perpetual FIFO method is used? (Answers are rounded to the nearest dollar.)

A) $1,200 B) $900 C) $1,050 D) $1,100 A) $1,200 B) $900 C) $1,050 D) $1,100

Santa Fe Tile Company had the following inventory purchases and sales during the month of May.The company uses the periodic inventory method. \[\begin{array} { | c | c | c | c | c | c | c | } \hline & \text { Purchases } & & & \text { Sales } & & \\ \hline \text { Date } & \text { Units } & \text { Unit Cost } & \text { Total } & \text { Units } & \text { Unit Price } & \text { Total } \\ \hline \text { May 1 } & 100 & \$ 4 & \$ 400 & & & \\ \hline 5 & 200 & 5 & 1,000 & & & \\ \hline 10 & & & & 100 & \$ 10 & \$ 1,000 \\ \hline 15 & 100 & 6 & 600 & & & \\ \hline 20 & 150 & 7 & 1,050 & & & \\ \hline 25 & & & & 200 & 11 & \$ 2,200 \\ \hline 30 & 160 & 8 & 1,280 & & & \\ \hline & 710 & & \$ 4,330 & 300 & & \$ 3,200 \\ \hline \end{array}\] - If Santa Fe uses LIFO costing,how much was the Cost of goods sold for the month?

A) $1,400 B) $1,850 C) $1,380 D) $1,640 A) $1,400 B) $1,850 C) $1,380 D) $1,640

Samson Company had the following balances and transactions during 2012. \[\begin{array} { | l | l | } \hline \text { Beginning inventory } & 10 \text { units at } \$ 70 \\ \hline \text { March } 10 & \text { Sold } 8 \text { units } \\ \hline \text { June } 10 & \text { Purchased } 20 \text { units at } \$ 80 \\ \hline \text { October 30 } & \text { Sold } 15 \text { units } \\ \hline \end{array}\] What would the company's Inventory amount be on the December 31,2012 balance sheet if the periodic LIFO costing method is used? (Answers are rounded to the nearest dollar.)

A) $560 B) $537 C) $554 D) $490 A) $560 B) $537 C) $554 D) $490

Williams Company had the following balances and transactions during 2013. \[\begin{array} { | l | l | } \hline \text { Beginning inventory } & 10 \text { units at } \$ 70 \\ \hline \text { June } 10 & \text { Purchased } 20 \text { units at } \$ 80 \\ \hline \text { December } 30 & \text { Sold } 15 \text { units } \\ \hline \text { December } 31 & \text { Replacement cost } \$ 78 \\ \hline \end{array}\] What would the company's inventory amount be on the December 31,2013 balance sheet if the perpetual average-costing method is used? (Answers are rounded to the nearest dollar.)

A) $1,200 B) $1,150 C) $1,050 D) $900 A) $1,200 B) $1,150 C) $1,050 D) $900

Santa Fe Tile Company had the following inventory purchases and sales during the month of May.The company uses the periodic inventory method. \[\begin{array} { | c | c | c | c | c | c | c | } \hline & \text { Purchases } & & & \text { Sales } & & \\ \hline \text { Date } & \text { Units } & \text { Unit Cost } & \text { Total } & \text { Units } & \text { Unit Price } & \text { Total } \\ \hline \text { May 1 } & 100 & \$ 4 & \$ 400 & & & \\ \hline 5 & 200 & 5 & 1,000 & & & \\ \hline 10 & & & & 100 & \$ 10 & \$ 1,000 \\ \hline 15 & 100 & 6 & 600 & & & \\ \hline 20 & 150 & 7 & 1,050 & & & \\ \hline 25 & & & & 200 & 11 & \$ 2,200 \\ \hline 30 & 160 & 8 & 1,280 & & & \\ \hline & 710 & & \$ 4,330 & 300 & & \$ 3,200 \\ \hline \end{array}\] - If Santa Fe uses average-cost,how much was the Ending inventory balance?

A) $2.980 B) $2,480 C) $2,715 D) $2,930 A) $2.980 B) $2,480 C) $2,715 D) $2,930

Santa Fe Tile Company had the following inventory purchases and sales during the month of May.The company uses the periodic inventory method. \[\begin{array} { | c | c | c | c | c | c | c | } \hline & \text { Purchases } & & & \text { Sales } & & \\ \hline \text { Date } & \text { Units } & \text { Unit Cost } & \text { Total } & \text { Units } & \text { Unit Price } & \text { Total } \\ \hline \text { May 1 } & 100 & \$ 4 & \$ 400 & & & \\ \hline 5 & 200 & 5 & 1,000 & & & \\ \hline 10 & & & & 100 & \$ 10 & \$ 1,000 \\ \hline 15 & 100 & 6 & 600 & & & \\ \hline 20 & 150 & 7 & 1,050 & & & \\ \hline 25 & & & & 200 & 11 & \$ 2,200 \\ \hline 30 & 160 & 8 & 1,280 & & & \\ \hline & 710 & & \$ 4,330 & 300 & & \$ 3,200 \\ \hline \end{array}\] - If Santa Fe uses FIFO costing,how much was the Ending inventory balance?

A) $2.980 B) $3,120 C) $2,200 D) $2,930 A) $2.980 B) $3,120 C) $2,200 D) $2,930

Exam 6: Merchandising Inventory

Golden Oak Antique Shop has the following account balances at the end of the current accounting period. Beginning inventory \ 73,250 Net purchases 57,650 Net sales revenue 85,500 A normal gross profit for the company is $45%.What is the company's estimated cost of goods sold for the accounting period?

(Multiple Choice)

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Question 21

Henderson Sales sold 400 units of product to a customer on account.The selling price was $25 per unit,and the cost,according to the company's inventory records,was $12 per unit. -Please provide the journal entry to record the Sales revenue.

(Essay)

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Question 22

Ending inventory for the current accounting period is overstated by $3,500.What will be effect of this error?

(Multiple Choice)

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Question 23

A company purchased 100 units for $20 each on January 31.It purchased 100 units for $30 on February 28.It sold 150 units for $45 each from March 1 through December 31.If the company uses the average-cost inventory costing method,what is the amount of ending inventory on December 31?

(Multiple Choice)

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Question 24

Santa Fe Tile Company had the following inventory purchases and sales during the month of May.The company uses the periodic inventory method. Purchases Sales Date Units Unit Cost Total Units Unit Price Total May 1 100 \ 4 \ 400 5 200 5 1,000 10 100 \ 10 \ 1,000 15 100 6 600 20 150 7 1,050 25 200 11 \ 2,200 30 160 8 1,280 710 \ 4,330 300 \ 3,200 - If Santa Fe uses LIFO costing,how much was the Ending inventory balance?

(Multiple Choice)

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Question 25

Williams Company had the following balances and transactions during 2013. Beginning inventory 10 units at \ 70 June 10 Purchased 20 units at \ 80 December 30 Sold 15 units December 31 Replacement cost \ 60 What would the company's inventory amount be on the December 31,2013 balance sheet if the perpetual FIFO method is used? (Answers are rounded to the nearest dollar.)

(Multiple Choice)

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Question 26

Santa Fe Tile Company had the following inventory purchases and sales during the month of May.The company uses the periodic inventory method. Purchases Sales Date Units Unit Cost Total Units Unit Price Total May 1 100 \ 4 \ 400 5 200 5 1,000 10 100 \ 10 \ 1,000 15 100 6 600 20 150 7 1,050 25 200 11 \ 2,200 30 160 8 1,280 710 \ 4,330 300 \ 3,200 - If Santa Fe uses LIFO costing,how much was the Cost of goods sold for the month?

(Multiple Choice)

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Question 27

Samson Company had the following balances and transactions during 2012. Beginning inventory 10 units at \ 70 March 10 Sold 8 units June 10 Purchased 20 units at \ 80 October 30 Sold 15 units What would the company's Inventory amount be on the December 31,2012 balance sheet if the periodic LIFO costing method is used? (Answers are rounded to the nearest dollar.)

(Multiple Choice)

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Question 28

Which of the following amounts would be reported for Inventory on the balance sheet if the cost of an item is $80,the current selling price is $100 and the current replacement cost is $75?

(Multiple Choice)

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(80)

Question 29

Williams Company had the following balances and transactions during 2013. Beginning inventory 10 units at \ 70 June 10 Purchased 20 units at \ 80 December 30 Sold 15 units December 31 Replacement cost \ 78 What would the company's inventory amount be on the December 31,2013 balance sheet if the perpetual average-costing method is used? (Answers are rounded to the nearest dollar.)

(Multiple Choice)

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Question 30

The Cost of goods available for sale is equal to the:

(Multiple Choice)

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Question 31

An overstatement of ending inventory in the current period results in the understatement of Net income in the current year.

(True/False)

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Question 32

In a period of rising costs,FIFO produces lower cost of goods sold and higher gross profit than LIFO.

(True/False)

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Question 33

Santa Fe Tile Company had the following inventory purchases and sales during the month of May.The company uses the periodic inventory method. Purchases Sales Date Units Unit Cost Total Units Unit Price Total May 1 100 \ 4 \ 400 5 200 5 1,000 10 100 \ 10 \ 1,000 15 100 6 600 20 150 7 1,050 25 200 11 \ 2,200 30 160 8 1,280 710 \ 4,330 300 \ 3,200 - If Santa Fe uses average-cost,how much was the Ending inventory balance?

(Multiple Choice)

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Question 34

Given the same purchase and sales data,the three major costing methods will result in three different amounts for Cost of goods sold.

(True/False)

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Question 35

A company is uncertain whether a complex transaction should be recorded as gain or loss.Under the conservatism principle,they should choose to treat it a loss.

(True/False)

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Question 36

Santa Fe Tile Company had the following inventory purchases and sales during the month of May.The company uses the periodic inventory method. Purchases Sales Date Units Unit Cost Total Units Unit Price Total May 1 100 \ 4 \ 400 5 200 5 1,000 10 100 \ 10 \ 1,000 15 100 6 600 20 150 7 1,050 25 200 11 \ 2,200 30 160 8 1,280 710 \ 4,330 300 \ 3,200 - If Santa Fe uses FIFO costing,how much was the Ending inventory balance?

(Multiple Choice)

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Question 37

The gross profit method is a way to estimate inventory on the basis of the cost of goods sold model.

(True/False)

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Question 38

A company is uncertain whether a complex transaction should be recorded as an asset or an expense.Under the conservatism principle,they should choose to treat it as an asset.

(True/False)

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Question 39

Berring Sales uses FIFO.The partially completed inventory record for January appears below. On January 14,the company sold 10 units.On January 29,the company sold 50 units. -Complete the inventory record and calculate the Ending inventory balance at the end of January.(Please round to the nearest whole dollar.)

(Multiple Choice)

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Question 40

Henderson Sales sold 400 units of product to a customer on account.The selling price was $25 per unit,and the cost,according to the company's inventory records,was $12 per unit. -Please provide the journal entry to record the Sales revenue.

Ending inventory for the current accounting period is overstated by $3,500.What will be effect of this error?

A company purchased 100 units for $20 each on January 31.It purchased 100 units for $30 on February 28.It sold 150 units for $45 each from March 1 through December 31.If the company uses the average-cost inventory costing method,what is the amount of ending inventory on December 31?

Which of the following amounts would be reported for Inventory on the balance sheet if the cost of an item is $80,the current selling price is $100 and the current replacement cost is $75?

The Cost of goods available for sale is equal to the:

An overstatement of ending inventory in the current period results in the understatement of Net income in the current year.

In a period of rising costs,FIFO produces lower cost of goods sold and higher gross profit than LIFO.

Given the same purchase and sales data,the three major costing methods will result in three different amounts for Cost of goods sold.

A company is uncertain whether a complex transaction should be recorded as gain or loss.Under the conservatism principle,they should choose to treat it a loss.

The gross profit method is a way to estimate inventory on the basis of the cost of goods sold model.

A company is uncertain whether a complex transaction should be recorded as an asset or an expense.Under the conservatism principle,they should choose to treat it as an asset.

Accounting and the Business Environment

Recording Business Transactions

The Adjusting Process

Completing the Accounting Cycle

Merchandising Operations

Internal Control and Cash

Receivables

Plant Assets and Intangibles

Current Liabilities and Payroll

Long-Term Liabilities, bonds Payable, and Classification of Liabilities on the Balance Sheet

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