110.Use this information to answer the following question.
Jan.
1
Inventory
15 units @ $4.00
8
Purchase
60 units @ $4.40
17
Purchase
30 units @ $4.20
25
Purchase
45 units @ $4.80
Total sales
100 units
A periodic inventory system is used.
Cost of goods sold under the average-cost method is
a.
$222.
b.
$333.
c.
$435.
d.
$444.
111.Use this information to answer the following question.
Jan.
1
Inventory
15 units @ $4.00
8
Purchase
60 units @ $4.40
17
Purchase
30 units @ $4.20
25
Purchase
45 units @ $4.80
Total sales
100 units
Cost of goods sold under FIFO is
a.
$426.
b.
$452.
c.
$429.
d.
$237.
112.Use this information to answer the following question.
Jan.
1
Inventory
15 units @ $4.00
8
Purchase
60 units @ $4.40
17
Purchase
30 units @ $4.20
25
Purchase
45 units @ $4.80
Total sales
100 units
A periodic inventory system is used.
Ending inventory under LIFO is
a.
$237.
b.
$214.
c.
$452.
d.
$429.
113.Use this information to answer the following question.
Jan.
1
Inventory
15 units @ $4.00
8
Purchase
60 units @ $4.40
17
Purchase
30 units @ $4.20
25
Purchase
45 units @ $4.80
Total sales
100 units
Assuming that the specific identification method is used and that ending inventory consists of 15 units from each of the three purchases and five units from the January 1 inventory, cost of goods sold is
a.
$445.
b.
$221.
c.
$418.
d.
$338.
114.In a period of declining prices, which of the following inventory methods generally results in the lowest balance sheet figure for inventory?
a.
LIFO
b.
FIFO
c.
Cannot tell without more information
d.
Average-cost
115.In a period of rising prices, which of the following inventory methods generally results in the lowest gross margin figure?
a.
FIFO
b.
Cannot tell without more information
c.
LIFO
d.
Average-cost
116.Which inventory method generally best follows the matching principle?
a.
LIFO
b.
FIFO
c.
Whichever method is used for tax purposes
d.
Average-cost
117.Which inventory method generally results in the most realistic up-to-date inventory figure?
a.
LIFO
b.
FIFO
c.
Whichever method produces the highest ending inventory figure
d.
Average-cost
118.In a period of rising prices, which inventory method is best to use to minimize income taxes?
a.
LIFO
b.
Average-cost
c.
FIFO
d.
Specific identification
119.Given equal circumstances, which inventory method probably would be the most time-consuming?
a.
FIFO
b.
LIFO
c.
Average-cost
d.
Specific identification
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