1. Inventory isa. Reported under the category of Property, Plant, and also Equipment on the balance sheet.b. Regularly reported as a miscellaneous price on the income statement.c. Reported as a current asset top top the balance sheet.d. Generally valued in ~ the price for which the items can it is in sold
2. Inventories affecta. Only the balance sheet.b. Only the income statement.c. Both the balance sheet and also the revenue statement.d. Neither the balance sheet no one the earnings statement.

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3. Items waiting to be offered in production are thought about to bea. Life materials.b. Work in progress.c. Perfect goods.d. Merchandise inventory.
4. In a production business, inventory that is ready for sale is calleda. Raw products inventory.b. Job-related in procedure inventory.c. Finished products inventory.d. Store supplies inventory.
5. For suppliers that use a perpetual perform system, all of the adhering to are purposes for taking a physics inventory excepta. To inspect the accuracy that the records.b. To determine the quantity of wasted life materials.c. To determine losses due to employee theft.d. To recognize ownership the the goods.
6. Cost of goods sold is computed from the complying with equation:a. Start inventory - cost of goods purchased + finishing inventory.b. Sales - cost of goods purchased + beginning inventory - finishing inventory.c. Sales + gross benefit - ending inventory + start inventory.d. Beginning inventory + price of goods purchased - ending inventory.
7. A firm just beginning in business purchased three merchandise inventory items in ~ the complying with prices. First purchase $65; second purchase $78; third purchase $68. If the firm sold 2 units because that a total of $200 and also used FIFO costing, the gross profit for the duration would bea. $55.b. $57.c. $62.d. $68.
8. The LIFO inventory technique assumes that the expense of the latest units purchased area. The last to it is in allocated to expense of goods sold.b. The an initial to be allocated to finishing inventory.c. The an initial to it is in allocated to expense of products sold.d. No allocated to cost of items sold or finishing inventory.
9. Harpo"s offered Cars uses the certain identification technique of costing inventory. During March, Harpo purchased three cars for $12,000, $14,400, and also $19,200, respectively. Throughout March, two cars are sold for a total of $36,400. Harpo determines the at march 31, the $14,400 vehicle is tho on hand. What is Harpo"s gross benefit for March?a. $2,800.b. $5,200.c. $4,200.d. $10,000.
10. Which among the adhering to inventory approaches is frequently impractical to use?a. Particular identificationb. LIFOc. FIFOd. Mean cost
11. The constant application the an inventory costing technique is necessary fora. Conservatism.b. Accuracy.c. Comparability.d. Efficiency.
12. List is reported in the financial statements ata. Cost.b. Market.c. The higher-of-cost-or-market.d. The lower-of-cost-or-market.
13. Under GAAP, service providers can select which inventory system?LIFO FIFOa. Correctly Nob. Correct Yesc. No Yesd. No No
14. Transactions that affect inventories on hand have an impact on both the balance sheet and also the income statement.a. True.b. False.
15. Under the FIFO method, the costs of the earliest systems purchased room the first charged to expense of goods sold.a. True.b. False.
16. The cost of goods accessible for sale is composed of the start inventory to add the cost of items purchased.a. True.b. False.

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17. In a perpetual inventory system, the expense of items sold under the FIFO technique is based upon the price of the latest items on hand throughout the period.a. True.b. False.
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