AC301 acc quiz help questions

AC301 acc quiz help questions - Which one of the following...

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Which one of the following types of costs is most likely to be included in determining the cost of inventory? (Points: 4) freight-in costs freight-out costs interest cost for amounts borrowed to finance the purchase of inventory marketing costs 2. Using the following letters to represent items: P = Purchases (net) C = Cost of goods sold B = Beginning inventory E = Ending inventory Which equation is correct? (Points: 4) B − C + P = E B − E = C + P P − E = B + C B = C − E + P 3. Which of the following is not an advantage of a perpetual inventory system? (Points: 4) assists in the prevention of stockouts requires less data processing effort than periodic systems maintains up-to-date inventory and cost of goods sold balances provides evidence of inventory shrinkage 4. Which of the following is not a disadvantage of using the FIFO cost flow assumption? (Points: 4) creates the highest outflow for income taxes during periods of rising prices does not match current costs against current revenues includes all the holding gains in income during periods of rising prices provides a relevant ending inventory value 5. Which one of the following statements is true? (Points: 4) LIFO can be used with lower of cost or market. On the balance sheet, LIFO reserves should be disclosed in the stockholders' equity section. A change from FIFO to LIFO is disclosed as a cumulative effect change in accounting principle on the income statement. Temporary LIFO liquidations can be ignored for costing purposes on interim statements. 6. Which one of the following is not an advantage of LIFO? (Points: 4) In periods of rising prices, less income taxes are paid. In periods of rising prices, less holding gains are reported in net income. Record keeping and financial statement preparation are easier. Conservative income statements and balance sheet disclosures result from rising prices. 7. Which one of the following statements is true? (Points: 4)
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Income manipulation is difficult under LIFO. Accounting principles do not require that the inventory cost flow approximate the physical flow of goods. Companies may use LIFO for tax purposes and FIFO in the financial statements. In periods of declining prices, LIFO will result in the payment of lower income taxes. 8. Which of the following items would not be used in the calculation of the cost-to-retail ratio if the FIFO retail inventory method were used to determine the ending inventory? (Points: 4) net markdowns purchases beginning inventory freight-in charges 9. Which of the following variations of the retail inventory method would generally result in the lowest cost-to-retail ratio in a period of rising prices? (Points: 4) FIFO LIFO average cost lower of average cost or market 10. At the beginning of 2010, the Nancy Company had an inventory valued at $34,375 at cost ($50,000 at retail). During the year, Nancy purchased inventory for $50,000 ($70,000 at retail), and made markdowns of $7,500. Nancy's sales in 2010 were $62,500. What is Nancy's estimated ending inventory at FIFO cost using the retail inventory
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This note was uploaded on 11/21/2011 for the course KAPLAN UNI MT 140 taught by Professor Thum during the Spring '10 term at Kaplan University.

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AC301 acc quiz help questions - Which one of the following...

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