108)
A company had inventory on November 1 of 5 units at a cost of $20 each. On November 2, they
purchased 10 units at $22 each. On November 6 they purchased 6 units at $25 each. On November
8, 8 units were sold for $55 each. Using the LIFO perpetual inventory method, what was the value
of the inventory on November 8 after the sale?
A) $304 B) $288 C) $296 D) $280 E) $276
109)
Marquis Company uses a weighted-average perpetual inventory system and has the following
purchases and sales:
August 2
10 units were purchased at $12 per unit.
August 18
15 units were purchased at $14 per unit.
August 29
12 units were sold.
What is the amount of the cost of goods sold for this sale? (Round average cost per unit to 2 decimal
places.)
A) $158.40 B) $150.50 C) $210.00 D) $148.00 E) $330.00
110)
Monarch Company uses a weighted-average perpetual inventory system, and has the following
purchases and sales:
January 1
20 units were purchased at $10 per unit.
January 12
12 units were sold.
January 20
18 units were purchased at $11 per unit.
What is the value of ending inventory? (Round average cost per unit to 2 decimal places, and final
answer to the nearest dollar.)
A) $272. B) $120. C) $278. D) $398. E) $126.
111)
Monarch Company uses a weighted-average perpetual inventory system and has the following
purchases and sales:
January 1
20 units were purchased at $10 per unit.
January 12
12 units were sold.
January 20
18 units were purchased at $11 per unit.
What is the value of cost of goods sold?
A) $272. B) $126. C) $120. D) $278. E) $398.
112)
Eastview Company uses a perpetual LIFO inventory system, and has the following purchases and
sales:
January 1
150 units were purchased at $9 per unit.
January 17
120 units were sold.
January 20
160 units were purchased at $11 per unit.
January 29
150 units were sold.
What is the value of cost of goods sold?
A) $2,670. B) $2,750. C) $2,730. D) $380. E) $440.
113)
Eastview Company uses a perpetual LIFO inventory system, and has the following purchases and
sales:
January 1
150 units were purchased at $9 per unit.
January 17
120 units were sold.
January 20
160 units were purchased at $11 per unit.
January 29
150 units were sold.
What is the value of ending inventory?
A) $2,670. B) $2,750. C) $380. D) $2,730. E) $440.
114)
Eastview Company uses a periodic LIFO inventory system, and has the following purchases and
sales:
January 1
150 units were purchased at $9 per unit.
January 17
120 units were sold.
January 20
160 units were purchased at $11 per unit.
January 29
150 units were sold.
What is the value of cost of goods sold?
A) $440. B) $2,750. C) $2,730. D) $2,670. E) $380.
115)
Eastview Company uses a periodic LIFO inventory system, and has the following purchases and
sales:
January 1
150 units were purchased at $9 per unit.
January 17
120 units were sold.
January 20
160 units were purchased at $11 per unit.
January 29
150 units were sold.
What is the value of ending inventory?
A) $2,670. B) $2,750. C) $360. D) $440. E) $2,730.
116)
Grays Company has inventory of 10 units at a cost of $10 each on August 1. On August 3, it
purchased 20 units at $12 each. 12 units are sold on August 6. Using the FIFO perpetual inventory
method, what amount will be reported as cost of goods sold for the 12 units that were sold?
A) $130. B) $120. C) $128. D) $124. E) $140.
117)
McCarthy Company has inventory of 8 units at a cost of $200 each on October 1. On October 2, it
purchased 20 units at $205 each. 11 units are sold on October 4. Using the FIFO perpetual
inventory method, what amount will be reported as cost of goods sold for the 11 units that were
sold?
A) $2,239. B) $2,228. C) $2,255. D) $2,215. E) $2,200.
118)
McCarthy Company has inventory of 8 units at a cost of $200 each on October 1. On October 2, it
purchased 20 units at $205 each. 11 units are sold on October 4. Using the FIFO perpetual
inventory method, what is the value of inventory after the October 4 sale?
A) $3,485. B) $3,445. C) $3,461. D) $3,472. E) $3,500.
119)
Starlight Company has inventory of 8 units at a cost of $200 each on October 1. On October 2, it
purchased 20 units at $205 each. 11 units are sold on October 4. Using the LIFO perpetual
inventory method, what amount will be reported in cost of goods sold for the 11 units that were
sold?
A) $2,255. B) $2,239. C) $2,200. D) $2,215. E) $2,228.
120)
Starlight Company has inventory of 8 units at a cost of $200 each on October 1. On October 2, it
purchased 20 units at $205 each. 11 units are sold on October 4. Using the LIFO perpetual
inventory method, what is the value of inventory after the October 4 sale?
A) $3,500. B) $3,485. C) $3,472. D) $3,445. E) $3,461.
121)
A company’s inventory records report the following:
August 1
Beginning balance
15 units @ $12
August 5
Purchase
10 units @ $13
August 12
Purchase
20 units @ $14
On August 15, it sold 30 units. Using the FIFO perpetual inventory method, what is the value of the
inventory at August 15 after the sale?
A) $140 B) $590 C) $380 D) $160 E) $210
122)
A company’s inventory records report the following in November of the current year:
Beginning
November 1
5 units @ $20
Purchase
November 2
10 units @ $22
Purchase
November 12
6 units @ $25
On November 8, it sold 12 units for $54 each. Using the LIFO perpetual inventory method, what
was the amount recorded in the cost of goods sold account for the 12 units sold?
A) $210 B) $188 C) $282 D) $260 E) $254
123)
A company’s inventory records report the following in November of the current year:
Beginning
November 1
5 units @ $20
Purchase
November 2
10 units @ $22
Purchase
November 12
6 units @ $25
On November 8, it sold 12 units for $54 each. Using the LIFO perpetual inventory method, what
amount of gross profit was earned from the 12 units sold?
A) $366 B) $388 C) $577 D) $260 E) $438
124)
A company sells garden hoses and uses the perpetual inventory system to account for its
merchandise. The beginning balance of the inventory and its transactions during September were as
follows:
September 1: Beginning balance of 18 units at $13 each
September 12: Purchased 30 units at $14 each
September 19: Sold 24 units at $30 selling price each
September 20: Purchased 24 units at $17 each
September 27: Sold 27 units at $30 selling price each
If the ending inventory is reported at $276, what inventory method was used?
A)
Weighted average method.
B)
LIFO method.
C)
Retail inventory method.
D)
Specific identification method.
E)
FIFO method.
125)
Jammer Company uses a weighted average perpetual inventory system and reports the following:
August 2
Purchase
10 units at $12 per unit.
August 18
Purchase
15 units at $15 per unit.
August 29
Sale
20 units.
August 31
Purchase
14 units at $16 per unit.
What is the per-unit value of ending inventory on August 31?
A) $17.74 B) $13.80 C) $12.00 D) $16.00 E) $15.42
126)
Given the following information, determine the cost of the inventory at June 30 using the LIFO
perpetual inventory method.
June 1
Beginning inventory
15 units at $20 each
June 15
Sale of 6 units for $50 each
June 29
Purchase
8 units at $25 each
The cost of the ending inventory is:
A) $220 B) $380 C) $275 D) $300 E) $200
127)
In applying the lower of cost or market method to inventory valuation, market is defined as:
A)
Historical cost.
B)
LIFO.
C)
Current replacement cost.
D)
Current sales price.
E)
FIFO.
128)
Raleigh Co. has the following products in its ending inventory. Compute the lower of cost or
market total for inventory applied separately to each product.
Product
Quantity
Cost per unit
Market per unit
Jelly
150
$2.00
2.15
Jam
370
$2.65
2.50
Marmalade
260
$3.10
3.05
A) $2,086.50. B) $2,053.50. C) $2,040.50. D) $2,018.00. E) $2,109.00.
129)
Generally accepted accounting principles require that the inventory of a company be reported at:
A)
Lower of cost or market.
B)
Replacement cost.
C)
Retail value.
D)
Historical cost.
E)
Market value.
130)
The conservatism constraint prescribes that:
A)
All items of a material nature are included in financial statements.
B)
When multiple estimates of amounts to be received or paid in the future are equally likely,
then the least optimistic amount should be used.
C)
A company use the same accounting methods period after period.
D)
Revenues and expenses are reported in the period in which they are earned or incurred.
E)
All inventory items are reported at full cost.
131)
A company’s normal selling price for its product is $20 per unit. However, due to market
competition, the selling price has fallen to $15 per unit. This company’s current inventory consists
of 200 units purchased at $16 per unit. Replacement cost has fallen to $13 per unit. Calculate the
value of this company’s inventory at the lower of cost or market.
A) $3,200. B) $2,700. C) $2,550. D) $2,600. E) $3,000.
132)
A company normally sells its product for $20 per unit. However, the selling price has fallen to $15
per unit. This company’s current inventory consists of 200 units purchased at $16 per unit.
Replacement cost has now fallen to $13 per unit. What is the amount of the lower cost of market
adjustment the company must make as a result of this decline in value?
A) $400. B) $600. C) $800. D) $1,400. E) $1,000.
133)
A company’s current inventory consists of 5,000 units purchased at $6 per unit. Replacement cost
has now fallen to $5 per unit. What is the entry the company must record to adjust inventory to
market?
A)
Debit Merchandise Inventory $25,000; credit Cost of Goods Sold $25,000.
B)
Debit Loss on Inventory $5,000; credit Cost of Goods Sold $5,000.
C)
Debit Cost of Goods Sold $30,000; credit Merchandise Inventory $30,000.
D)
Debit Cost of Goods Sold $5,000; credit Merchandise Inventory $5,000.
E)
Debit Merchandise Inventory $30,000; credit Cost of Goods Sold $25,000.
134)
A company has the following per unit original costs and replacement costs for its inventory. LCM is
applied to individual items.
Part A: 50 units with a cost of $5, and replacement cost of $4.50
Part B: 75 units with a cost of $6, and replacement cost of $6.50
Part C: 160 units with a cost of $3, and replacement cost of $2.50