Chapter 7 Inventories and Cost of Goods Sold_Sakai.pptx - Introduction to Financial Accounting Chapter 7 Inventories and Cost of Goods Sold LEARNING

Chapter 7 Inventories and Cost of Goods Sold_Sakai.pptx -...

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Introduction to Financial Accounting Chapter 7 Inventories and Cost of Goods Sold
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LEARNING OBJECTIVES Describe the issues in managing different types of inventory Explain how to report inventory and cost of goods sold Compute costs using three inventory costing methods Report inventory at the lower of cost and net realizable value Evaluate inventory management by computing and interpreting the inventory turnover ratio
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INVENTORY MANAGEMENT The primary goals of inventory managers are to: 1.ensure sufficient quantities of inventory are available to meet customers’ needs, 2.ensure inventory quality meets customers’ expectations and company standards, and 3.minimize the costs of acquiring and carrying inventory. The primary goals of inventory managers are to: 1.ensure sufficient quantities of inventory are available to meet customers’ needs, 2.ensure inventory quality meets customers’ expectations and company standards, and 3.minimize the costs of acquiring and carrying inventory.
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TYPES OF INVENTORY Merchandiser Inventory is acquired in a finished condition and is ready for sale without further processing. Inventory is acquired in a finished condition and is ready for sale without further processing. Raw materials inventory includes materials that are processed further into finished goods. Work in process inventory includes goods that are in the process of being manufactured. Finished goods inventory includes goods that are complete and ready to sell.
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  • Fall '11
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