1. Inventory does not include:
2. The largest expense on a retailer’s income statement is typically:
3. If a company overstates its ending balance of inventory in year 1 and it records inventory
correctly in year 2, which one of the following is true?
4. If a company understates its ending balance of inventory in year 1 and it records inventory
5. If a company understates its count of ending inventory in Year 1, which of the following is
6. Bill Inc.’s correct ending balance for the inventory account at the end of 2012 should be
$5,000, but the company incorrectly stated it as $3,000. In 2013, Bill correctly recorded its
7. Suppose that Hastings Corporation overstates its ending inventory for 2012. What effect
will this have on the reported amount of cost of goods sold for 2012?
8. Cost of Goods Sold is:
9. Cost of goods sold equals:
10. Baker Fine Foods has beginning inventory for the year of $12,000. During the year, Baker
purchases inventory for $150,000 and ends the year with $20,000 of inventory. Baker will
report cost of goods sold equal to:
11. Tyler Toys has beginning inventory for the year of $18,000. During the year, Tyler
purchases inventory for $230,000 and has cost of goods sold equal to $233,000. Tyler’s
ending inventory equals:
12. Inventory records for Dunbar Incorporated revealed the following:
Dunbar sold 700 units of inventory during the month. Ending inventory assuming LIFO
would be:
13. Inventory records for Dunbar Incorporated revealed the following:
Dunbar sold 700 units of inventory during the month. Cost of goods sold assuming LIFO
would be:
14. Inventory records for Dunbar Incorporated revealed the following:
Dunbar sold 700 units of inventory during the month. Ending inventory assuming FIFO
would be:
15. Inventory records for Dunbar Incorporated revealed the following:
Dunbar sold 700 units of inventory during the month. Cost of goods sold assuming FIFO
would be:
16. Inventory records for Dunbar Incorporated revealed the following:
Dunbar sold 700 units of inventory during the month. Ending inventory assuming weighted-
average cost would be (round weighted-average unit cost to four decimals if necessary):
17. Inventory records for Dunbar Incorporated revealed the following:
Dunbar sold 700 units of inventory during the month. Cost of goods sold assuming weighted-
average cost would be (round weighted-average unit cost to four decimals if necessary):
18. Inventory records for Marvin Company revealed the following:
Marvin sold 2,300 units of inventory during the month. Ending inventory assuming LIFO
would be:
19. Inventory records for Marvin Company revealed the following:
Marvin sold 2,300 units of inventory during the month. Ending inventory assuming FIFO
would be:
20. Inventory records for Marvin Company revealed the following:
Marvin sold 2,300 units of inventory during the month. Ending inventory assuming weighted-
average cost would be (round weighted-average unit cost to four decimals if necessary):
21. Inventory records for Marvin Company revealed the following:
Marvin sold 2,300 units of inventory during the month. Cost of goods sold assuming LIFO
would be:
22. Inventory records for Marvin Company revealed the following:
Marvin sold 2,300 units of inventory during the month. Cost of goods sold assuming FIFO
would be:
23. Inventory records for Marvin Company revealed the following:
Marvin sold 2,300 units of inventory during the month. Cost of goods sold assuming
weighted-average cost would be (round weighted-average unit cost to four decimals if
necessary):
24. The following information pertains to Julia & Company:
What is the cost of goods sold for Julia & Company assuming it uses LIFO?
25. The following information pertains to Julia & Company:
What’s the ending balance of inventory for Julia & Company assuming that it uses FIFO?
26. Consider the following inventory transactions for September:
For the month of September, the company sold 35 units. What is the cost of good sold under
the weighted-average cost method (round the weighted-average unit cost to four decimals if
necessary)?
27. The following information relates to inventory for Shoeless Joe Inc.
At what amount would Shoeless report gross profit using LIFO cost flow assumptions?
28. The following information relates to inventory for Shoeless Joe Inc.
At what amount would Shoeless report ending inventory using FIFO cost flow assumptions?