Chapter 8(1)

Chapter 8(1) - 1. 1. Identify major classifications of...

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Unformatted text preview: 1. 1. Identify major classifications of inventory. Identify major classifications of inventory. 2. 2. Distinguish between perpetual and periodic inventory systems. Distinguish between perpetual and periodic inventory systems. 3. 3. Identify the effects of inventory errors on the financial statements. Identify the effects of inventory errors on the financial statements. 4. 4. Understand the items to include as inventory cost. Understand the items to include as inventory cost. 5. 5. Describe and compare the cost flow assumptions used to account for inventories. Describe and compare the cost flow assumptions used to account for inventories. 6. 6. Explain the significance and use of a LIFO reserve. Explain the significance and use of a LIFO reserve. 7. 7. Understand the effect of LIFO liquidations. Understand the effect of LIFO liquidations. 8. 8. Explain the dollar-value LIFO method. Explain the dollar-value LIFO method. 9. 9. Identify the major advantages and disadvantages of LIFO. Identify the major advantages and disadvantages of LIFO. 10. 10. Understand why companies select given inventory methods. Understand why companies select given inventory methods. Chapter 8-VALUATION OF INVENTORIES: Chapter 8-VALUATION OF INVENTORIES: A COST-BASIS APPROACH A COST-BASIS APPROACH Chapter 8-VALUATION OF INVENTORIES: Chapter 8-VALUATION OF INVENTORIES: A COST-BASIS APPROACH A COST-BASIS APPROACH Inventory Inventory Issues Issues Physical Physical Goods Goods Included in Included in Inventory Inventory Costs Costs Included Included in Inventory in Inventory Cost Flow Cost Flow Assumptions Assumptions LIFO: Special LIFO: Special Issues Issues Classification Classification Cost flow Cost flow Control Control Basic inventory Basic inventory valuation valuation Basis for Basis for Selection Selection Goods in transit Goods in transit Consigned Consigned goods goods Special sales Special sales agreements agreements Inventory errors Inventory errors Product costs Product costs Period costs Period costs Purchase Purchase discounts discounts Specific Specific identification identification Average cost Average cost FIFO FIFO LIFO LIFO LIFO reserve LIFO reserve LIFO liquidation LIFO liquidation Dollar-value Dollar-value LIFO LIFO Comparison of Comparison of LIFO approaches LIFO approaches Advantages of Advantages of LIFO LIFO Disadvantages of Disadvantages of LIFO LIFO Summary of Summary of inventory inventory valuation valuation methods methods Valuation of Inventories: Valuation of Inventories: Cost-Basis Approach Cost-Basis Approach Valuation of Inventories: Valuation of Inventories: Cost-Basis Approach Cost-Basis Approach Inventories are: items held for sale, or goods to be used in the production of goods to be sold....
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Chapter 8(1) - 1. 1. Identify major classifications of...

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