ACCY 111: Accounting Exam! Quiz
20 Questions
| Total Attempts: 552
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Questions and Answers
- 1.In a perpetual inventory system, the cost of inventory sold is
- A.
Credit to Cost of Goods Sold
- B.
Debited to Accounts Receivable
- C.
Debited to Cost of Goods Sold
- D.
Not recorded at the time
- 2.In a periodic inventory system, the cost of inventories sold is:
- A.
Not recorded at the time of sale
- B.
Debited to cost of goods sold
- C.
Debited to accounts receivable
- D.
Credited to cost of goods sold
- 3.The inventory method that will always produce the same amount for the cost of goods sold in a periodic inventory system as in a perpetual inventory system would be:
- A.
FIFO
- B.
LIFO
- C.
Weighted Average
- D.
None of these
- 4.The use of LIFO in accounting for a firm's inventory:
- A.
Usually matches the physical flow of goods through the business
- B.
Is usually used for internal mgmt purposes
- C.
Usually provides a better match of expenses with revenues
- D.
None of these is correct
- 5.The primary reason for the popularity of LIFO is that it:
- A.
Simplifies record keeping
- B.
Saves income taxes currently
- C.
Provides better matching of physical flow and cost flow
- D.
Provides a permanent reduction of income taxes
- 6.When reported in financial statements, a LIFO allowance account usually:
- A.
Indicates the effect on insome if LIFO were not used
- B.
Is shown in the firm's income statement
- C.
Is added to LIFO cost to indicate what the inventory would cost on a FIFO bases
- D.
Shows the current rate of inflation for tha asset
- 7.If a company uses LIFO, a LIFO liquidation is problematic for a company's income taxes:
- A.
Whether inventory purchase costs are declining or rising
- B.
LIFO liquidations are not problematic for a company's income taxes
- C.
When inventory purchase costs are rising
- D.
When inventory purchase costs are declining
- 8.Alison's dress shop buys dresses from McGuire Manufacturing. Alison purchased dresses from McGuire on July 17, and received an invoice with a list price amount of $6,200 and payment terms of 3/10, n/30. Alison uses the net method to record purchases. Alison should record the purchase at:
- A.
$3,007
- B.
$6,386
- C.
$6,014
- D.
$6,200
- 9.Northwest Fur Co. started 2009 with $97,000 of merchandise inventory on hand. During 2009, $440,000 in merchandise was purchased on account with credit terms of 1/15, n/45. All discounts were taken. Purchases were all made f.o.b. shipping point. Northwest paid freight charges of $9,500. Merchandise with an invoice amount of $3,000 was returned for credit. Cost of goods sold for the year was $376,000. Northwest uses a perpetual inventory system. What is ending inventory assuming Northwest uses the gross method to record purchases?
- A.
$163,070
- B.
$167,500
- C.
$170,500
- D.
$163,130
- 10.Fulbright Corp. uses the periodic inventory system. During its first year of operations, Fulbright made the following purchases (listed in chronological order of acquisition): • 45 units at $106 • 75 units at $72 • 175 units at $51 Sales for the year totaled 273 units, leaving 22 units on hand at the end of the year. Ending inventory using the average cost method is
- A.
$1,424.
- B.
$1,172
- C.
$1,122
- D.
$2,332
- 11.Fulbright Corp. uses the periodic inventory system. During its first year of operations, Fulbright made the following purchases (listed in chronological order of acquisition): • 40 units at $90 • 70 units at $83 • 171 units at $60 Sales for the year totaled 272 units, leaving 9 units on hand at the end of the year. Ending inventory using the FIFO method is:
- A.
$590
- B.
$810
- C.
$540
- D.
$630
- 12.Fulbright Corp. uses the periodic inventory system. During its first year of operations, Fulbright made the following purchases (listed in chronological order of acquisition): • 40 units at $110 • 72 units at $78 • 170 units at $56 Sales for the year totaled 271 units, leaving 11 units on hand at the end of the year. Ending inventory using the LIFO method is
- A.
$666.
- B.
$616
- C.
$1,210
- D.
$762
- 13.Nu Company reported the following pretax data for its first year of operations. Net sales 2,810 Cost of goods available for sale 2,370 Operating expenses 800 Effective tax rate 30% Ending inventories: If LIFO is elected 930 If FIFO is elected 1,160 What is Nu's net income if it elects FIFO?
- A.
$1,600
- B.
$399
- C.
$560
- D.
$800
- 14.Nu Company reported the following pretax data for its first year of operations. Net sales 2,820 Cost of goods available for sale 2,490 Operating expenses 740 Effective tax rate 30% Ending inventories: If LIFO is elected 820 If FIFO is elected 1,080
- A.
$287
- B.
$469
- C.
$410.
- D.
$670
- 15.Nu Company reported the following pretax data for its first year of operations. Net sales 2,990 Cost of goods available for sale 2,330 Operating expenses 860 Effective tax rate 40% Ending inventories: If LIFO is elected 950 If FIFO is elected 1,160 What is Nu's gross profit ratio if it elects LIFO? (Round your answer to the nearest whole percentage.)
- A.
19%
- B.
61%
- C.
54%
- D.
66%
- 16.Nueva Company reported the following pretax data for its first year of operations. Net sales 7,380 Cost of goods available for sale 5,690 Operating expenses 1,708 Effective tax rate 40% Ending inventories: If LIFO is elected 618 If FIFO is elected 812 What is Nueva's gross profit ratio if it elects FIFO? (Round your answer to two decimal places e.g., .1234 as 12.34%.)
- A.
62.54%
- B.
31.27%
- C.
57.05%
- D.
33.9%
- 17.Thompson TV and Appliance reported the following in its 2009 financial statements: 2009 Sales $424,000 Cost of goods sold: Inventory, January 1 62,000 Net purchases 330,000 Goods available for sale 392,000 Inventory, December 31 102,000 Cost of goods sold 290,000 Gross profit $134,000 Thompson's 2009 gross profit ratio is
- A.
None of these is correct
- B.
22%
- C.
31%
- D.
32%
- 18.Thompson TV and Appliance reported the following in its 2009 financial statements: 2009 Sales $436,000 Cost of goods sold: Inventory, January 1 75,000 Net purchases 329,000 Goods available for sale 404,000 Inventory, December 31 86,000 Cost of goods sold 318,000 Gross profit $118,000 Thompson's 2009 inventory turnover ratio is
- A.
3.7
- B.
5.07
- C.
3.95
- D.
5.42
- 19.
![Anthony Thomas Candies (ATC) reported the following financial data for 2009 and 2008:
The average days inventory for ATC for 2009 is: - ProProfs]( "Anthony Thomas Candies (ATC) reported the following financial data for 2009 and 2008:
The average days inventory for ATC for 2009 is:")
Anthony Thomas Candies (ATC) reported the following financial data for 2009 and 2008: The average days inventory for ATC for 2009 is:- A.
151 days
- B.
Less than 100 days
- C.
114 days
- D.
132 days
- 20.Bond Company adopted the dollar-value LIFO inventory method on January 1, 2009. In applying the LIFO method, Bond uses internal cost indexes and the multiple-pools approach. The following data were available for Inventory Pool No. 3 for the two years following the adoption of LIFO: Ending Inventory At Current At Base Year Cost Year Cost Cost index 1/1/09 $303,500 $303,500 1 12/31/09 351,540 325,500 1.08 12/31/10 420,000 350,000 1.2 Under the dollar-value LIFO method the inventory at December 31, 2010, should be
- A.
$356,660
- B.
$350,000
- C.
$351,760
- D.
None of these
Questions: 41 | Attempts: 63432 | Last updated: Nov 16, 2020
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