1 The assignment of costs to cost of goods sold and to inventory using specific identification is the same for both the perpetual and periodic systems.
2 The inventory valuation method that results in the lowest taxable income in a period of inflation is:
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A. LIFO method |
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B. FIFO method |
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C. Weighted-average cost method |
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D. Specific identification method |
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E. Gross profit method |
3During a period of steadily rising costs, the inventory valuation method that yields the lowest reported net income is:
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A. Specific identification method |
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B. Average cost method |
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C. Weighted-average method |
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D. FIFO method |
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E. LIFO method |
4A 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 FIFO perpetual inventory method, what was the value of the inventory on November 8 after the sale?
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A. $304 |
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B. $296 |
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C. $288 |
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D. $280 |
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E. $276
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