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Exam 6: Inventories

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Question 61

Multiple Choice

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If the estimated rate of gross profit is 30%,what is the estimated cost of the merchandise inventory on September 30,based on the following data?

A) $320,000
B) $192,500
C) $275,000
D) $105,000

E) All of the above
F) A) and B)

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Question 62

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The following lots of a particular commodity were available for sale during the year: The firm uses the periodic system and there are 20 units of the commodity on hand at the end of the year.What is the amount of inventory at the end of the year according to the LIFO method?

A) $655
B) $620
C) $690
D) $659

E) B) and D)
F) A) and B)

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Question 63

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The following units of an inventory item were available for sale during the year: The firm uses the periodic inventory system.During the year,60 units of the item were sold. The value of ending inventory using LIFO is:

Beginning inventory,purchases and sales data for tennis rackets are as follows: Complete the inventory cost card assuming the business maintains a perpetual inventory system and calculates the cost of merchandise sold and ending inventory using LIFO.

For the year ended December 31,2014 Depot Max's cost of merchandise sold was $56,900.Inventory at the beginning of the year was $6,540.Ending inventory was $7,250.Depot Max's number of days sales in inventory is closest to

Stevens Company started the year with an inventory cost of $145,000.During the month of January they purchased inventory that cost of $53,000.January sales totaled $140,000.Estimated gross profit is 35%.The estimated ending inventory as of January 31 is

Most large companies will use only one inventory costing methods for all of its different segments.

In the retail inventory method,the cost to retail ratio is equal to the cost of goods sold divided by the retail price of the good sold.

The two most widely used methods for determining the cost of inventory are

Use the following information to answer the following questions. The Boxwood Company sells blankets for $60 each.The following was taken from the inventory records during May.The company had no beginning inventory on May 1. Assuming that the company uses the perpetual inventory system,determine the cost of merchandise sold for the sale of May 20 using the LIFO inventory cost method.

The following units of a particular item were available for sale during the year: The firm uses the perpetual inventory system and there are 240 units of the item on hand at the end of the year.What is the total cost of ending inventory according to FIFO?

Beginning inventory,purchases,and sales for Product - Weld TM are as follows: Assuming a perpetual inventory system and the first-in,first-out method,determine (a)the cost of the merchandise sold for the September 30 sale and (b)the inventory on September 30.

If a fire destroys the merchandise inventory,the gross profit method can be used to estimate the cost of merchandise destroyed.

Under the _________ inventory method,accounting records maintain a continuously updated inventory value.

The following data regarding purchases and sales of a commodity were taken from the related perpetual inventory account:

Which of the following is used to analyze the efficiency and effectiveness of inventory management?

During periods of increasing costs,an advantage of the LIFO inventory cost method is that it matches more recent costs against current revenues.

Determine the total value of the merchandise using Net Realizable Value:

The units of Manganese Plus available for sale during the year were as follows: There are 15 units of the product in the physical inventory at November 30.The periodic inventory system is used.Determine the difference in gross profit between the LIFO and FIFO inventory cost systems.

Beginning inventory,purchases and sales data for widgets are as follows: Complete the inventory cost card assuming the business maintains a perpetual inventory system and calculates the cost of merchandise sold and ending inventory using FIFO.