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Exam 6: Accounting for Inventory

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Question 61

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Use the following information to answer: The following data represent the beginning inventory and, in order of occurrence, the purchases and sales of Woof, Inc. for an operating period. -Assuming Woof, Inc. uses weighted-average (perpetual) inventory procedures, the ending inventory cost is:

A) $3,744
B) $3,186
C) $3,384
D) $3,276

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Question 62

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Use the following information to answer: The following data represent the beginning inventory and, in order of occurrence, the purchases and sales of Purr-A-Lot, Inc. for an operating period. -Assuming Purr-A-Lot, Inc. uses weighted-average (perpetual) inventory procedures, the ending inventory cost is:

A) $4,992
B) $5,088
C) $4,512
D) $4,368

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Question 63

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The following inventory was available for sale during the year for Tower Tools: Tower Tools has 25 units on hand at the end of the year. What is the dollar amount of inventory at the end of the year according to the first-in, first-out method?

If inventory at the end of the year is understated by $105,000, what will this error cause?

Use the following information to answer: The following data represent the beginning inventory and, in order of occurrence, the purchases and sales of Ilse's Garden, Inc., for an operating period. -Assuming Ilse's Garden, Inc. uses FIFO periodic inventory procedures, the ending inventory cost is:

Heinrich Company, which uses a periodic inventory system, imports and sells a product produced in Germany. In the summer of 2018, a natural disaster disrupted production, affecting its supply of product. Heinrich uses the LIFO inventory method. On January 1, 2019, Heinrich's inventory records were as follows: Through mid-December of 2019, purchases were limited to 50,000 units, because the cost had increased to $50 per unit. Heinrich sold 55,000 units during 2019 at a selling price of $100 per unit, which significantly depleted its inventory. The cost was expected to drop to $42 per unit by early January 2020. a. Assume that Heinrich makes no further purchases during 2019. Compute the gross profit for 2019. b. Assume that Heinrich purchases 8,800 units before the end of December 2019 at $50 each. Compute its gross profit for 2019. c. If Heinrich's corporate tax rate is 30%, how much tax savings will result from the purchase of inventory before year end?

Use the following information to answer: The following data represent the beginning inventory and, in order of occurrence, the purchases and sales of Delacour, Inc. for an operating period. -Assuming Delacour, Inc. uses FIFO perpetual inventory procedures, it records sale No. 2 as an entry to Cost of Goods Sold for:

Use the following information to answer: The following represents the inventory of Kailey Company for the month of April: -Assuming a periodic inventory system is used by Kailey Company, what is ending inventory under LIFO?

Charleston Company uses the periodic inventory system. For the current month, the beginning inventory consisted of 1,200 units that cost $45 each. During the month, the company made two purchases: 500 units at $43.50 each and 2,000 units at $42 each. Charleston Company also sold 2,150 units during the month. Using the periodic , what is the cost of ending inventory?

Use the following data for Hubbard Model Car Company, determine the value of inventory under the lower-of-cost-or-net realizable value rule, applied on an individual item basis.

Use the following information to answer: The following data represent the beginning inventory and, in order of occurrence, the purchases and sales of Purr-A-Lot, Inc. for an operating period. -Assuming Purr-A-Lot, Inc. uses LIFO perpetual inventory procedures, the ending inventory cost is:

Data on the physical inventory for Lu Company as of December 31, 2019 are given below: Assuming the Lu Company applies the lower-or-cost-or-net realizable value method on the inventory by major category of items, the inventory balance reported on the Balance Sheet as of December 31, 2019 will be:

Use the following information to answer: The following represents the inventory of Moonlight Company for the month of January: -Calculate Moonlight Company's Cost of Goods Sold using Periodic Weighted-Average for the month of January (rounded to the nearest dollar) .

Use the following information to answer: The following data represent the beginning inventory and, in the order of occurrence, the purchases and sales of Tina Star Company for an operating period. -Assuming Tina Star Company uses weighted-average (perpetual) inventory procedures, sale No. 1 is recorded as an entry to Cost of Goods Sold for:

Use the following information to answer: The following data represent the beginning inventory and, in order of occurrence, the purchases and sales of Ilse's Garden, Inc., for an operating period. -Assuming Ilse's Garden, Inc. uses FIFO perpetual inventory procedures, it records sale No. 2 as an entry to Cost of Goods Sold for:

The following data refer to Lion Company's ending inventory: How much is the inventory if the lower-of-cost-or-net realizable value rule is applied to each item of inventory?

Use the following information to answer: The following data represent the beginning inventory and, in the order of occurrence, the purchases and sales of Mullenax Company for an operating period. -Assuming Mullenax Company uses LIFO periodic inventory procedures, the ending inventory cost is:

In its 2019 income statement, Mary T. Company reported cost of goods sold of $255,000. Later, Mary T. determined that beginning inventory for 2019 was understated by $69,000, and the ending inventory for 2019 was understated by $30,000. What should be the corrected amount for cost of goods sold for 2019?

Chief Software Company's 2019 balance sheet reveals that inventories reported on a LIFO basis are $16,860 million. In a footnote, management stated that the LIFO reserve was $2,400 million. a. How much would Chief's Software's ending inventory be using FIFO? b. What is the total cumulative tax effect of using LIFO given a 35% income tax rate?

During its first year of operations, Oscar Company, using a periodic inventory system, made undiscovered errors in taking its year-end inventory that overstated Year 1 ending inventory by $200,000. The effect of these errors on reported income is: