16. If Beamon Company is using LIFO, how would the accountant compute cost of goods sold when recording a sale under the perpetual inventory system? 17. Smithfield Company uses the...

16. If Beamon Company is using LIFO, how would the accountant compute cost of goods sold when recording a sale under the perpetual inventory system?

17. Smithfield Company uses the weighted average inventory cost flow method. How would Smithfield's accountant compute cost of goods sold when recording a sale under the perpetual inventory system?

18. If some inventory items have declined in value from damage or obsolescence, what effect will the lower-of-cost-or-market rule have on the amount of inventory shown on the balance sheet?

19. Murphy's Electronics applies the lower-of-cost-or-market rule to individual items of inventory. In 2011, some of Murphy's inventory lost value due to obsolescence. Other items increased in market value. In total, the market value of Murphy's inventory was higher at the end of 2011 than the cost of the inventory. Would Murphy have an adjustment to make at the end of 2011 due to the lower-of-cost-or-market rule? Would the answer be any different if Murphy applied the rule in aggregate rather than to individual items?

20. Explain the computation of the inventory amount if the lower-of-cost-or-market rule is applied using the individual inventory item approach.

21. Explain the meaning of "cost" and "market" as used in the application of the lower-of-cost-or-market rule.