BMGT 220 EXAMINATION 2
April 7, 2011
Important: Bubble in your responses in the spaces provided next to each question on the Scantron sheet.
MULTIPLE CHOICE QUESTIONS: Identify the letter of the choice (A,B,C or D) that best completes the statement or answers the question,
and darken the corresponding on the Scantron sheet.
Goods in transit which are shipped f.o.b. shipping point should be
included in the inventory of the shipping company.
included in the inventory of the buyer.
included in the inventory of the seller.
none of the above.
What is consigned inventory?
Goods that are sold, but payment is not required until the goods are sold.
Goods that are shipped, and title transfers to the buyer.
Goods that have been segregated for shipment to a customer.
Goods that are shipped, but title remains with the seller.
Checkers uses the periodic inventory system. For the current month, the beginning inventory
consisted of 1,200 units that cost $12 each. During the month, the company made two purchases:
500 units at $13 each and 2,000 units at $13.50 each. Checkers also sold 2,150 units during the
month. Using the FIFO method, what is the cost of ending inventory?
Chess Top uses the periodic inventory system. For the current month, the beginning inventory
consisted of 200 units that cost $65 each. During the month, the company made two purchases: 300
units at $69 each and 150 units at $70 each. Chess Top also sold 500 units during the month. Using
the average cost method, what is the cost of ending inventory?
Which inventory costing method most closely approximates current cost for each of the following?