# Quantitative methods 105 companies adopt different

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Quantitative Methods 105.Companies adopt different cost flow methods for each of the following reasonsexcept a.statement of financial position effects. b.cash flow effects. c.income statements effects. d.tax effects. Ans: B, LO: 2, Bloom: K, Difficulty: Easy, Min: 1, AACSB: None, AICPA BB: Industry/Sector Perspective, AICPA FN: Measurement, AICPA PC: None, IMA: Business Economic
106. In periods of rising prices, the inventory method which results in the inventory value on the statement of financial position that is closest to current cost is the
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107.If companies have identical inventory costs but use different inventory flow assumptions when the price of goods havenot
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lOMoARcPSD|13497295 Inventories6 - 19 c.ending inventory of the companies will be identical. d.net income of the companies will be identical. Ans: B, LO: 2, Bloom: C, Difficulty: Easy, Min: 1, AACSB: None, AICPA BB: Industry/Sector Perspective, AICPA FN: Measurement, AICPA PC: None, IMA: Business Economic 108.The specific identification method of inventory costing
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109.The accountant at Paige Company is figuring out the difference in income taxes the company will pay depending on the choice of either FIFO or average-cost as an inventory costing method. The tax rate is 30% and the FIFO method will result in income before taxes of \$36,400. The average- cost method will result in income before taxes of \$32,900. What is the difference in tax that would be paid between the two methods? a. \$3,500. b.\$1,500. c.\$1,050. d.Cannot be determined from the information provided. Ans: C, LO: 2, Bloom: AP, Difficulty: Hard, Min: 3, AACSB: Analytic, AICPA BB: Legal/Regulatory Perspective, AICPA FN: Measurement, AICPA PC: Problem Solving, IMA:

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