Question :
70.Physical counts of inventory:
A.Are not necessary under the perpetual : 1258860
70.Physical counts of inventory:
A.Are not necessary under the perpetual system.
B.Are necessary to adjust the Inventory account to the actual inventory available.
C.Must be taken at least once a month.
D.Requires the use of hand-held portable computers.
E.Are not necessary under the cost-to-benefit constraint.
71.During a period of steadily rising costs, the inventory valuation method that yields the highest reported net income is:
A.Specific identification method.
B.Average cost method.
C.Weighted-average method.
D.FIFO method.
E.LIFO method.
72.The inventory valuation method that tends to smooth out erratic changes in costs is:
A.FIFO.
B.Weighted average.
C.LIFO.
D.Specific identification.
E.WIFO.
73.The inventory valuation method that has the advantages of assigning an amount to inventory on the balance sheet that approximates its current cost, and also mimics the actual flow of goods for most businesses is:
A.FIFO.
B.Weighted average.
C.LIFO.
D.Specific identification.
E.Lower of cost or market.
74.The inventory valuation method that results in the lowest taxable income in a period of inflation is:
A.LIFO method.
B.FIFO method.
C.Weighted-average cost method.
D.Specific identification method.
E.Gross profit method.
75.The consistency concept:
A.Prescribes a company use the same accounting method of inventory valuation, an exception being when a change from one method to another will improve its financial reporting.
B.Requires a company to use one method of inventory valuation exclusively.
C.Requires that all companies in the same industry use the same accounting methods of inventory valuation.
D.Is also called the full disclosure principle.
E.Is also called the matching principle.
76.The full disclosure principle:
A.Prescribes that the notes to the financial statements report the change from one inventory valuation method to another.
B.Requires that companies use the same accounting method for inventory valuation period after period.
C.Is not subject to the consideration of materiality.
D.Is only applied to retailers and manufacturers.
E.Is also called the consistency principle.
77.Which of the following prescribes the use of the less optimistic amount when more than one estimate of an amount to be received or paid exists and the estimates are about equally likely?
A.Full disclosure principle.
B.Consistency concept.
C.FIFO inventory valuation method.
D.Conservatism constraint.
E.Matching principle.
78.Which of the following inventory costing methods will always result in the same values for ending inventory and cost of goods sold regardless of whether a perpetual or periodic inventory system is used?
A.FIFO and LIFO
B.LIFO and weighted-average cost
C.Specific identification and FIFO
D.FIFO and weighted-average cost
E.LIFO and specific identification
79.If a period-end inventory amount is reported in error, it can cause a misstatement in all of the following except:
A.Cost of goods sold.
B.Gross profit.
C.Net sales.
D.Current assets.
E.Net income.
