11) If a company is using a perpetual inventory system, the balance in its inventory account three-quarters of the way through an accounting period would be equal to:
A) the total of the beginning inventory plus goods purchased during the accounting period
B) the inventory on hand at the beginning of the period
C) the amount of inventory on hand at that date
D) the amount of goods purchased during the period
12) Which of the following would be included in the Cost of Goods Sold account on a merchandising company's income statement?
A) shipping costs from the manufacturer to the merchandiser
B) sales commissions
C) costs of advertising
D) sales taxes
13) Given the following data, what is the weighted-average cost of ending inventory rounded to the nearest whole dollar? (Do not round in the process of your calculations, only round your final answer.)
Sales revenue100 units at $15 per unit
Beginning inventory40 units at $9 per unit
Purchases80 units at $10 per unit
A) $300
B) $200
C) $193
D) $180
14) Given the following data, what is cost of goods sold as determined under the FIFO method?
Sales revenue350 units at $35 per unit
Beginning inventory120 units at $15 per unit
Purchases400 units at $20 per unit
A) $6,400
B) $5,250
C) $4,600
D) $7,000
15) Given the following data, calculate the cost of ending inventory using the FIFO costing method:
1/1Beginning inventory45 units at $10 per unit
2/25Purchases40 units at $12 per unit
6/15Purchases30 units at $13 per unit
9/20Purchases25 units at $14 per unit
12/31Ending inventory40 units
A) $400
B) $545
C) $480
D) $560
16) Given the following data, calculate the cost of ending inventory using the weighted-average method, rounding to the nearest dollar. (Do not round in the process of your calculations, only round your final answer.)
1/1Beginning inventory50 units at $10 per unit
3/5Purchases30 units at $14 per unit
5/30Purchases25 units at $15 per unit
10/25Purchases20 units at $16 per unit
12/31Ending inventory45 units
A) $720
B) $619
C) $581
D) $450
17) FIFO tends to increase cost of goods sold when:
A) costs are increasing
B) costs are declining
C) costs are constant
D) FIFO will always yield the lowest possible cost of goods sold
18) FIFO tends to decrease cost of goods sold when:
A) costs are constant
B) costs are decreasing
C) costs are increasing
D) FIFO will always yield the lowest possible taxes
19) If a company uses FIFO and prices are rising, large purchases of inventory near the end of the year will:
A) decrease gross margin
B) cause cost of goods sold to be equal under FIFO and LIFO
C) decrease the value of ending inventory
D) increase gross margin
20) When the FIFO method is used, cost of goods sold is assumed to consist of:
A) the most recently purchased units
B) the units with the lowest per unit cost
C) the units with the highest per unit cost
D) the oldest units