29. The following information relates to inventory for Shoeless Joe Inc.
At what amount would Shoeless report cost of goods sold using the weighted-average cost
flow assumption? (Round your answer to the nearest dollar)
30. In a period when inventory costs are rising, the inventory method that most likely results
in the highest ending inventory is:
31. In a period when inventory costs are falling, the lowest taxable income is most likely
reported by using the inventory method of:
32. Which of the following is true regarding LIFO and FIFO?
33. During periods when inventory costs are rising, cost of goods sold will most likely be:
34. In a period of rising prices, which inventory valuation method would a company likely
choose if they want to have the highest possible balance of inventory on the balance sheet?
35. During periods when inventory costs are rising, ending inventory will most likely be:
36. The LIFO conformity rule states that if LIFO is used for:
37. The primary reason for the popularity of LIFO is that it gives:
38. Which inventory method is better described as having an income statement focus and why
is it considered as such?
39. Which inventory method is better described as having a balance sheet focus and why is it
considered as such?
40. Which inventory cost flow assumption generally results in the highest reported amount for
cost of goods sold when inventory costs are falling?
42. In a perpetual inventory system, the purchase of inventory is debited to:
43. In a perpetual inventory system, at the time of a sale the cost of inventory sold is:
44. Good, Inc. sold inventory for $1,200 that was purchased for $700. Good records which of
the following when it sells inventory using a perpetual inventory system?
45. Davis Hardware Company uses a perpetual inventory system. How should Davis record
the sale of inventory costing $620 for $960 on account?
46. Ace Bonding Company purchased inventory on account. The inventory costs $2,000 and
is expected to sell for $3,000. How should Ace record the purchase using a perpetual
inventory system?
47. Merchandise sold FOB destination indicates that:
48. Merchandise sold FOB shipping point indicates that:
49. If A sells to B, and B obtains title while goods are in transit, the goods were shipped. If C
sells to D, and C maintains title until the goods arrive at D’s door then the goods were
shipped.
50. Ending inventory is equal to the cost of items on hand plus:
51. Suppose Company A places an order with Company B on May 12. On May 14, Company
B ships the ordered goods to Company A with terms FOB destination. The goods arrive at
Company A on May 17. Company A begins selling the goods to customers on May 19 and
pays Company B on May 20. When would Company B record the sale of goods to Company
A?
52. Davis Hardware Company uses a perpetual inventory system. How should Davis record
the return of inventory previously purchased on account for $200?
53. On May 1, Ace Bonding Company purchased inventory costing $2,000 on account with
terms 2/10, n/30. On May 8, Ace pays for this inventory and records which of the following
using a perpetual inventory system?
54. On May 1, Ace Bonding Company purchased inventory costing $2,000 on account with
terms 2/10, n/30. On May 18, Ace pays for this inventory and records which of the following
using a perpetual inventory system?
55. The distinction between operating and nonoperating income relates to:
56. Given the information below, what is the gross profit?
57. Consider the following year-end information for Spitzer Corporation:
What amount will Spitzer report for operating income?
58. Given the information in the table below, what is the company’s gross profit?
59. LeGrand Corporation reported the following amounts in its income statement:
What was LeGrand’s gross profit?
60. LeGrand Corporation reported the following amounts in its income statement:
What was LeGrand’s operating income?
61. LeGrand Corporation reported the following amounts in its income statement:
What was LeGrand’s net income?
62. Wildwood, an outdoors clothing store, reports the following information for June:
What is Wildwood’s gross profit for June?
63. Niva Company has the following information for their inventories A, B, C, and D: