Inventories

11 questions

1. 1. Which of the following costs is an example of a period cost and is not capitalized in the inventory account?
   Materials used in manufacturingLabour costStorage cost
2. 2. The inventory cost flow method under which the cost of the most recent purchase is matched first against sales revenues is:
   FIFOLIFOWeighted Average Cost
3. 3. The inventory cost flow method under which the cost of the most recent purchases are likely to remain in inventory is:
   FIFOLIFOWeighted Average Cost
4. 4. A company purchased merchandise to be resold at increasing costs during the year 2021. The purchases were made at the following costs:

   

   The company sold 10 items at the end of each month during the year.

   What is the number of units and cost of goods available for sale?

   140 units, $1660120 units, $1460100 units, $1350
5. 5. A company purchased merchandise to be resold at increasing costs during the year 2021. The purchases were made at the following costs:

   

   The company sold 10 items at the end of each month during the year.

   Assuming the periodic LIFO inventory accounting method, calculate the company's cost of goods sold for the 120 items sold during the year?

   $1460$1270$1422
6. 6. A company purchased merchandise to be resold at increasing costs during the year 2021. The purchases were made at the following costs:

   

   The company sold 10 items at the end of each month during the year.

   Assuming the periodic FIFO inventory accounting method, calculate the company's cost of goods sold for the 120 items sold during the year?

   $1460$1270$1422
7. 7. A company purchased merchandise to be resold at increasing costs during the year 2021. The purchases were made at the following costs:

   

   The company sold 10 items at the end of each month during the year.

   Assuming the periodic weighted-average cost flow method, calculate the company's cost of goods sold for the 120 items sold during the year?

   $1460$1270$1422
8. 8. Which of the following inventory accounting methods is not allowed under IFRS?
   FIFOLIFOWeighted-average cost
9. 9. During periods when inventory costs are rising, cost of goods sold will most likely be:
   Higher under FIFO than LIFO.Higher under FIFO than average cost.Lower under average cost than LIFO.
10. 10. If merchandise inventory is being valued at cost and the price level is steadily rising, the method of costing that will yield the highest net income is?
    FIFO LIFO Average
11. 11. The replacement cost of an inventory item is below the net realizable value and above the net realizable value less a normal profit margin. The inventory item's original cost is above the net realizable value. Under the lower of cost or market method, the inventory item should be valued at:
    Original costReplacement cost Net realizable value