Ch2- The Balance Sheet-3

Ch2- The Balance Sheet-3 - Cost flow assumption made in...

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Inventories Items held for _______ or _______ in the manufacture of products that will be sold 2-1
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Inventories (cont.) Retail Company One type of inventory: ________ ______ Manufacturing Company Three types of inventories: ______ _________ ________-____-__________ Finished goods 2-2
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Inventories (cont.) Accounting method chosen to ________ ___________ and the associated measurement of _______ of ______ sold have a considerable impact on a company’s financial position and operating results 2-3
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Inventory Accounting Methods Inventory valuation is based on an ____________ regarding the flow of goods Has nothing to do with the _______ order in which products are sold
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Unformatted text preview: Cost flow assumption made in order to _________ the cost of products sold to the revenue generated 2-4 Inventory Accounting Methods (cont.) Three cost flow assumptions: FIFO (F______ I__, F_______ O____) LIFO (L_____ I__, F_______ O____) Average cost 2-5 Inventory Accounting Methods (cont.) 2-6 Accounting Method FIFO LIFO Average Cost Cost of Goods Sold (Income Statement) first purchases last purchases (close to current cost) average of all purchases Inventory Valuation (Balance Sheet) last purchases (close to current cost) first purchases average of all purchases...
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This note was uploaded on 02/10/2011 for the course AEB 3103 taught by Professor Cazanova during the Spring '08 term at University of Florida.

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Ch2- The Balance Sheet-3 - Cost flow assumption made in...

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