Chapter 6 Quiz\t\t\t\t\t\t\t\t\tQuestion 1\t\t\t\t\t\t\t\t\t\u00a0\t\t\t\t\t\t\t\t\tRaw materials inventories are the goods that a manufacturing company has completed and are ready to be sold to customers.\t\t\t\t\t\t\t\t\tQuestion 2\t\t\t\t\t\t\t\t\t\u00a0\t\t\t\t\t\t\t\t\tGoods held on consignment should be included in the consignor’s ending inventory\t\t\t\t\t\t\t\t\t\u00a0\t\t\t\t\t\t\t\t\tQuestion 3 \t\t\t\t\t\t\t\t\t\u00a0\t\t\t\t\t\t\t\t\tIf a company has no beginning inventory and the unit cost of inventory items does not change during the year, the value assigned to the ending inventory will be the same under LIFO and average cost flow assumptions\t\t\t\t\t\t\t\t\t\u00a0\t\t\t\t\t\t\t\t\tQuestion 4 \t\t\t\t\t\t\t\t\t\u00a0\t\t\t\t\t\t\t\t\tThe LIFO method is rarely used because most companies do not sell the last goods they purchase first.\t\t\t\t\t\t\t\t\tQuestion 5 \t\t\t\t\t\t\t\t\t\u00a0\t\t\t\t\t\t\t\t\tThe FIFO reserve is a required disclosure for companies that use FIFO.\t\t\t\t\t\t\t\t\tQuestion 6 \t\t\t\t\t\t\t\t\t\u00a0\t\t\t\t\t\t\t\t\tManufactured inventory that has begun the production process but is not yet completed is\t\t\t\t\t\t\t\t\tQuestion 7 \t\t\t\t\t\t\t\t\t\u00a0\t\t\t\t\t\t\t\t\tWhich of the following should not be included in the physical inventory of a company?\t\t\t\t\t\t\t\t\tQuestion 8 \t\t\t\t\t\t\t\t\t\u00a0\t\t\t\t\t\t\t\t\tAt December 31, 2014 Howell Company’s inventory records indicated a balance of $858,000. Upon further investigation it was determined that this amount included the following:\t\t\t\t\t\u00a0$168,000 in inventory purchases made by Howell shipped from the seller 12\/27\/14 terms FOB destination, but not due to be received until January 2nd\t\t\t\t\t\u00a0$111,000 in goods sold by Howell with terms FOB destination on December 27th. The goods are not expected to reach their destination until January 6th.\t\t\t\t\t\u00a0$9,000 of goods received on consignment from Westwood Company\t\t\t\t\t\t\t\t\t\tWhat is Howell’s correct ending inventory balance at December 31, 2014?\t\t\t\t\t\t\t\t\tQuestion 9\t\t\t\t\t\t\t\t\t\u00a0\t\t\t\t\t\t\t\t\tNoise Makers Inc has the following inventory data:\t\t\t\t\tJuly 1 \ufffd \ufffd\u00a0 Beginning inventory \ufffd\u00a0\u00a0\u00a0\u00a0 20 units at $19 \ufffd\u00a0 $ 380\t\t\t\t\t \ufffd\u00a0 7 \ufffd \ufffd\u00a0 Purchases \ufffd \ufffd \ufffd \ufffd\u00a0\u00a0\u00a0\u00a0 70 units at $20 \ufffd 1,400\t\t\t\t\t\u00a0\u00a0\u00a0\u00a0 22 \ufffd \ufffd\u00a0 Purchases \ufffd \ufffd \ufffd \ufffd\u00a0\u00a0\u00a0\u00a0 10 units at $22 \ufffd\u00a0 \u00a0\u00a0220\t\t\t\t\t \ufffd \ufffd \ufffd \ufffd \ufffd \ufffd \ufffd \ufffd \ufffd \ufffd \ufffd \ufffd \ufffd \ufffd \ufffd \ufffd \ufffd \ufffd \u00a0\u00a0$2,000\t\t\t\t\t\u00a0\t\t\t\t\tA physical count of merchandise inventory on July 30 reveals that there are 32 units on hand. Using the average cost method, the value of ending inventory is\t\t\t\t\t\t\t\t\tQuestion 10\t\t\t\t\t\t\t\t\t\u00a0\t\t\t\t\t\t\t\t\tInventory costing methods place primary reliance on assumptions about the flow of\t\t\t\t\t\t\t\t\tQuestion 11 \t\t\t\t\t\t\t\t\t\u00a0\t\t\t\t\t\t\t\t\tMany companies use just-in-time inventory methods. Which of the following is not an advantage of this method?\t\t\t\t\t\t\t\t\tQuestion 12\t\t\t\t\t\t\t\t\t\u00a0\t\t\t\t\t\t\t\t\tWhich of the following statements is correct with respect to inventories?\t\t\t\t\t\t\t\t\tQuestion 13 \t\t\t\t\t\t\t\t\t\u00a0\t\t\t\t\t\t\t\t\tIn periods of rising prices, which is an advantage of using the LIFO inventory costing method?\t\t\t\t\t\t\t\t\tQuestion 14 \t\t\t\t\t\t\t\t\t\u00a0\t\t\t\t\t\t\t\t\tJenks Company developed the following information about its inventories in applying the lower of cost or market (LCM) basis in valuing inventories:\t\t\t\t\tProduct \ufffd \ufffd\u00a0\u00a0 \ufffd\u00a0\u00a0\u00a0Cost\u00a0\u00a0 \ufffd \ufffd\u00a0\u00a0\u00a0\u00a0Market\u00a0\u00a0 \ufffd\u00a0\u00a0\t\t\t\t\t \ufffd A \ufffd \ufffd \ufffd \ufffd\u00a0 $57,000 \ufffd \ufffd\u00a0\u00a0 $60,000\t\t\t\t\t \ufffd B \ufffd \ufffd \ufffd \ufffd\u00a0\u00a0\u00a0 40,000 \ufffd \ufffd\u00a0\u00a0\u00a0\u00a0 38,000\t\t\t\t\t\u00a0\u00a0\u00a0\u00a0 C \ufffd \ufffd \ufffd \ufffd\u00a0\u00a0\u00a0 80,000 \ufffd \ufffd\u00a0\u00a0\u00a0\u00a0 81,000\t\t\t\t\t\u00a0\t\t\t\t\tIf Jenks applies the LCM basis, the value of the inventory reported on the balance sheet would be\t\t\t\t\t\t\t\t\tQuestion 15\t\t\t\t\t\t\t\t\t\u00a0\t\t\t\t\t\t\t\t\tSelection of an inventory costing method by management does not usually depend on\t\t\t\t\t\t\t\t\tQuestion 16\t\t\t\t\t\t\t\t\t\u00a0\t\t\t\t\t\t\t\t\tWhich statement concerning lower of cost or market (LCM) is incorrect?\t\t\t\t\t\t\t\t\tQuestion 17 \t\t\t\t\t\t\t\t\t\u00a0\t\t\t\t\t\t\t\t\tUse the following information regarding Black Company and Red Company to answer the question “Which of the following is Red Company’s “cost of goods sold” for 2014 (to the closest dollar)?”\ufffd\t\t\t\t\t\t\t\t\tQuestion 18\t\t\t\t\t\t\t\t\t\u00a0\t\t\t\t\t\t\t\t\tA low number of days in inventory may indicate all of the following except\t\t\t\t\t\t\t\t\tQuestion 19 \t\t\t\t\t\t\t\t\t\u00a0\t\t\t\t\t\t\t\t\tThe LIFO reserve is\t\t\t\t\t\t\t\t\tQuestion 20 \t\t\t\t\t\t\t\t\t\u00a0\t\t\t\t\t\t\t\t\tMatch the items below by entering the appropriate code letter in the space provided.<\/p>\n","protected":false},"excerpt":{"rendered":"
Chapter 6 Quiz Question 1 \u00a0 Raw materials inventories are the goods that a manufacturing company has completed and are ready to be sold to customers. Question 2 \u00a0 Goods held on consignment should be included in the consignor’s ending Read More …<\/a><\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[],"tags":[],"class_list":["post-200214","post","type-post","status-publish","format-standard","hentry"],"_links":{"self":[{"href":"https:\/\/www.benedictsol.com\/blogs\/wp-json\/wp\/v2\/posts\/200214","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.benedictsol.com\/blogs\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.benedictsol.com\/blogs\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.benedictsol.com\/blogs\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/www.benedictsol.com\/blogs\/wp-json\/wp\/v2\/comments?post=200214"}],"version-history":[{"count":0,"href":"https:\/\/www.benedictsol.com\/blogs\/wp-json\/wp\/v2\/posts\/200214\/revisions"}],"wp:attachment":[{"href":"https:\/\/www.benedictsol.com\/blogs\/wp-json\/wp\/v2\/media?parent=200214"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.benedictsol.com\/blogs\/wp-json\/wp\/v2\/categories?post=200214"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.benedictsol.com\/blogs\/wp-json\/wp\/v2\/tags?post=200214"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}