Question 1

When a weighted average cost assumption is applied with a perpetual system,it is sometimes
called a __________________.

Accepted Answer

The answer of When a weighted average cost assumption is...

Question 2

Which one of the following is not a contra account?

Accepted Answer

A) Purchase Returns and Allowances 
B) Accumulated Depreciation 
C) Transportation-in 
D) Sales Discounts 
A) Purchase Returns and Allowances 
B) Accumulated Depreciation 
C) Transportation-in 
D) Sales Discounts

Question 3

When would LIFO liquidation occur?

Accepted Answer

A) As a result of selling more units than are purchased during the period. 
B) As a result of selling less units than are purchased during the period. 
C) As a result of selling the same number of units that are purchased during the period. 
D) Not enough information. 
A) As a result of selling more units than are purchased during the period. 
B) As a result of selling less units than are purchased during the period. 
C) As a result of selling the same number of units that are purchased during the period. 
D) Not enough information.

Question 4

Adam Inc.uses a perpetual inventory system.   If Adam uses the FIFO method,how much is cost of goods sold for the month of January?

Accepted Answer

A) $204 
B) $208 
C) $212 
D) $560 
A) $204 
B) $208 
C) $212 
D) $560

Question 5

The cost of goods sold is

Accepted Answer

A) Purchases less beginning inventory plus ending inventory 
B) Reported on the balance sheet in the inventory account 
C) Goods available for sale less ending inventory 
D) Equal to the amount of inventory on hand at the end of the accounting period 
A) Purchases less beginning inventory plus ending inventory 
B) Reported on the balance sheet in the inventory account 
C) Goods available for sale less ending inventory 
D) Equal to the amount of inventory on hand at the end of the accounting period

Question 6

Baucus,Inc.
Baucus,Inc.reported the following information for 2014 and 2013:
   Refer to the information for Baucus,Inc.
What amount is cost of goods available for sale for 2014?

Accepted Answer

$580,000 (Purchases)+ $18,000

Question 7

Gently Used Cars is a dealer that uses the periodic inventory system.The data presented below is from the accounting records of Gently for the year ended December 31,2014.
   Using the amounts provided above,calculate the cost of goods sold for 2014.

Accepted Answer

$421,000
$33,000 (Inventory at

Question 8

Texas Inc.sold merchandise to Flange Corp.on December 28,2013,with shipping terms of FOB destination.Flange Corp.received the merchandise on January 3,2014.Which one of the following statements is true?

Accepted Answer

A) Texas should record sales revenue on December 28,2013. 
B) Flange Corp.should pay the transportation costs. 
C) Flange Corp.should include the merchandise in its inventory at December 31,2013. 
D) Flange Corp.should record a liability for the purchase on January 3,2014. 
A) Texas should record sales revenue on December 28,2013. 
B) Flange Corp.should pay the transportation costs. 
C) Flange Corp.should include the merchandise in its inventory at December 31,2013. 
D) Flange Corp.should record a liability for the purchase on January 3,2014.

Question 9

The journal entry to write down inventory to its market value results in a loss on the income statement.

Accepted Answer

A) True 
 B)False

Question 10

Cost of goods available for sale is equal to beginning inventory less cost of goods sold.

Accepted Answer

A) True 
 B)False

Question 11

The cost of goods purchased is equal to net purchases plus ____________________.

Accepted Answer

freight-in

Question 12

The inventory method that assigns the most recent costs to ending inventory is LIFO.

Accepted Answer

A) True 
 B)False

Question 13

When merchandise is sold FOB shipping point,the buyer is responsible for the shipping costs.

Accepted Answer

A) True 
 B)False

Question 14

Which one of the following statements is false?

Accepted Answer

A) The inventory account is updated after every sale and after every merchandise purchase under the perpetual inventory system. 
B) The inventory account is updated only at the end of the accounting period under the periodic inventory system. 
C) A cost of goods sold account is updated after each sale of merchandise under the periodic inventory system. 
D) A purchases account is used only under the periodic inventory system. 
A) The inventory account is updated after every sale and after every merchandise purchase under the perpetual inventory system. 
B) The inventory account is updated only at the end of the accounting period under the periodic inventory system. 
C) A cost of goods sold account is updated after each sale of merchandise under the periodic inventory system. 
D) A purchases account is used only under the periodic inventory system.

Question 15

A company began the year with $150,000 in inventory and ended the year with $170,000 in inventory.Cost of goods sold for the year amounted to $960,000.Assuming 360 days in a year,how long,on average,does it take the company to sell its inventory (to the nearest day)?

Accepted Answer

A) 6 days 
B) 60 days 
C) 120 days 
D) 3 days 
A) 6 days 
B) 60 days 
C) 120 days 
D) 3 days

Question 16

Moving average is the name given to the use of an average cost method used with a periodic inventory system.

Accepted Answer

A) True 
 B)False

Question 17

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

Accepted Answer

A) Barbie dolls 
B) Cartons of milk 
C) Custom designed diamond rings 
D) Gasoline in storage tanks at a gasoline station 
A) Barbie dolls 
B) Cartons of milk 
C) Custom designed diamond rings 
D) Gasoline in storage tanks at a gasoline station

Question 18

Eversoll Inc.uses the periodic inventory system.   If Eversoll uses the LIFO inventory method,the cost of goods sold for June would be

Accepted Answer

A) $1,354.00 
B) $2,200.00 
C) $2,272.50 
D) $2,296.08 
A) $1,354.00 
B) $2,200.00 
C) $2,272.50 
D) $2,296.08

Question 19

Which of these is not an acceptable inventory costing method under IFRS?

Accepted Answer

A) FIFO 
B) LIFO 
C) Specific Identification 
D) Average cost 
A) FIFO 
B) LIFO 
C) Specific Identification 
D) Average cost

Question 20

Complete the following data taken from the condensed income statements for merchandising companies: Action,Break,& Connors.

Accepted Answer

@#IMG-DLM& OR rearranged in th

When a weighted average cost assumption is applied with a perpetual system,it is sometimes called a __________________.

Which one of the following is not a contra account?

When would LIFO liquidation occur?

Adam Inc.uses a perpetual inventory system. If Adam uses the FIFO method,how much is cost of goods sold for the month of January?

The cost of goods sold is

Baucus,Inc. Baucus,Inc.reported the following information for 2014 and 2013: Refer to the information for Baucus,Inc. What amount is cost of goods available for sale for 2014?

Gently Used Cars is a dealer that uses the periodic inventory system.The data presented below is from the accounting records of Gently for the year ended December 31,2014. Using the amounts provided above,calculate the cost of goods sold for 2014.

Texas Inc.sold merchandise to Flange Corp.on December 28,2013,with shipping terms of FOB destination.Flange Corp.received the merchandise on January 3,2014.Which one of the following statements is true?

The journal entry to write down inventory to its market value results in a loss on the income statement.

Cost of goods available for sale is equal to beginning inventory less cost of goods sold.

The cost of goods purchased is equal to net purchases plus ____________________.

The inventory method that assigns the most recent costs to ending inventory is LIFO.

When merchandise is sold FOB shipping point,the buyer is responsible for the shipping costs.

Which one of the following statements is false?

A company began the year with $150,000 in inventory and ended the year with $170,000 in inventory.Cost of goods sold for the year amounted to $960,000.Assuming 360 days in a year,how long,on average,does it take the company to sell its inventory (to the nearest day)?

Moving average is the name given to the use of an average cost method used with a periodic inventory system.

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

Eversoll Inc.uses the periodic inventory system. If Eversoll uses the LIFO inventory method,the cost of goods sold for June would be

Which of these is not an acceptable inventory costing method under IFRS?

Complete the following data taken from the condensed income statements for merchandising companies: Action,Break,& Connors.

Accounting As a Form of Communication

Financial Statements and the Annual Report

Processing Accounting Information

Income Measurement and Accrual Accounting

Cash and Internal Control

Receivables and Investments

Operating Assets: Property, plant, and Equipment, and Intangibles

Current Liabilities, contingencies, and the Time Value of Money

Long-Term Liabilities

Stockholders Equity

The Statement of Cash Flows

Financial Statement Analysis

International Financial Reporting Standards

Filters

Exam 5: Inventories and Cost of Goods Sold

When a weighted average cost assumption is applied with a perpetual system,it is sometimes called a __________________.

Which one of the following is not a contra account?

When would LIFO liquidation occur?

Adam Inc.uses a perpetual inventory system. If Adam uses the FIFO method,how much is cost of goods sold for the month of January?

The cost of goods sold is

Baucus,Inc. Baucus,Inc.reported the following information for 2014 and 2013: Refer to the information for Baucus,Inc. What amount is cost of goods available for sale for 2014?

Gently Used Cars is a dealer that uses the periodic inventory system.The data presented below is from the accounting records of Gently for the year ended December 31,2014. Using the amounts provided above,calculate the cost of goods sold for 2014.

Texas Inc.sold merchandise to Flange Corp.on December 28,2013,with shipping terms of FOB destination.Flange Corp.received the merchandise on January 3,2014.Which one of the following statements is true?

The journal entry to write down inventory to its market value results in a loss on the income statement.

Cost of goods available for sale is equal to beginning inventory less cost of goods sold.

The cost of goods purchased is equal to net purchases plus ____________________.

The inventory method that assigns the most recent costs to ending inventory is LIFO.

When merchandise is sold FOB shipping point,the buyer is responsible for the shipping costs.

Which one of the following statements is false?

A company began the year with $150,000 in inventory and ended the year with $170,000 in inventory.Cost of goods sold for the year amounted to $960,000.Assuming 360 days in a year,how long,on average,does it take the company to sell its inventory (to the nearest day)?

Moving average is the name given to the use of an average cost method used with a periodic inventory system.

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

Eversoll Inc.uses the periodic inventory system. If Eversoll uses the LIFO inventory method,the cost of goods sold for June would be

Which of these is not an acceptable inventory costing method under IFRS?

Complete the following data taken from the condensed income statements for merchandising companies: Action,Break,& Connors.

Accounting As a Form of Communication

Financial Statements and the Annual Report

Processing Accounting Information

Income Measurement and Accrual Accounting

Cash and Internal Control

Receivables and Investments

Operating Assets: Property, plant, and Equipment, and Intangibles

Current Liabilities, contingencies, and the Time Value of Money

Long-Term Liabilities

Stockholders Equity

The Statement of Cash Flows

Financial Statement Analysis

International Financial Reporting Standards

Filters