CH 9 - CHAPTER 9 INVENTORIES: ADDITIONAL VALUATION ISSUES...

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CHAPTER 9 INVENTORIES: ADDITIONAL VALUATION ISSUES MULTIPLE CHOICE —Conceptual Answer No. Description d 1. Knowledge of lower of cost or market valuations. d 2. Appropriate use of LCM valuation. c 3. Definition of "market" under LCM. b 4 . D e f i n i t i o n o f " c e i l i n g . " a 5. Definition of "designated market value." c 6. Application of lower of cost or market valuation. d 7. Effect of inventory write-down. b 8. Net realizable value under LCM. d 9. Definition of "net realizable value." a 1 0 . V a l u a t i o n o f i n v e n t o r y a t n e t r e a l i z a b l e v a l u e . d 1 1 . A p p r o p r i a t e u s e o f n e t r e a l i z a b l e v a l u e . a 1 2 . M a t e r i a l p u r c h a s e c o m m i t m e n t s . a 1 3 . L o s s r e c o g n i t i o n o n p u r c h a s e c o m m i t m e n t s . d 1 4 . A p p r o p r i a t e u s e o f t h e g r o s s p r o f i t m e t h o d . b 1 5 . A p p r o p r i a t e u s e o f t h e g r o s s p r o f i t m e t h o d . d 1 6 . A d v a n t a g e o f r e t a i l i n v e n t o r y m e t h o d . c 1 7 . C o n v e n t i o n a l r e t a i l i n v e n t o r y m e t h o d . a 1 8 . A s s u m p t i o n s o f t h e r e t a i l i n v e n t o r y m e t h o d . d 1 9 . A p p r o p r i a t e u s e o f t h e r e t a i l i n v e n t o r y m e t h o d . b 2 0 . M a r k d o w n s a n d t h e c o n v e n t i o n a l r e t a i l m e t h o d . a 2 1 . M a r k u p s a n d t h e c o n v e n t i o n a l r e t a i l m e t h o d . b * 2 2 . K n o w l e d g e o f t h e c o s t r a t i o f o r r e t a i l i n v e n t o r y m e t h o d s . c 2 3 . I n v e n t o r y t u r n o v e r r a t i o . c * 2 4 . D o l l a r - v a l u e L I F O r e t a i l m e t h o d . MULTIPLE CHOICE —Computational Answer No. Description a 2 5 . V a l u e i n v e n t o r y a t L C M . c 2 6 . R e l a t i v e s a l e s m e t h o d o f i n v e n t o r y v a l u a t i o n . c 2 7 . E n t r y f o r p u r c h a s e c o m m i t m e n t l o s s . d 2 8 . C a l c u l a t e c o s t o f g o o d s s o l d g i v e n a m a r k u p o n c o s t . d 2 9 . C a l c u l a t e m e r c h a n d i s e p u r c h a s e s g i v e n a m a r k u p o n c o s t . a 3 0 . C a l c u l a t e t o t a l s a l e s f r o m c o s t i n f o r m a t i o n . a 3 1 . M a r k u p o n c o s t e q u i v a l e n t t o a m a r k u p o n s e l l i n g p r i c e . b 3 2 . E s t i m a t e e n d i n g i n v e n t o r y u s i n g g r o s s p r o f i t m e t h o d . c 3 3 . C a l c u l a t e e n d i n g i n v e n t o r y u s i n g g r o s s p r o f i t m e t h o d *This topic is dealt with in an Appendix to the chapter. MULTIPLE CHOICE—Computational (cont.) Answer No. Description . b 34. Calculate ending inventory using gross profit method.
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a 3 5 . E s t i m a t e c o s t o f i n v e n t o r y d e s t r o y e d b y f i r e . a
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CH 9 - CHAPTER 9 INVENTORIES: ADDITIONAL VALUATION ISSUES...

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