10. Which of the following costs should not be included in the cost of sheet? A.

Question

10. Which of the following costs should not be included in the cost of sheet? A. The inventory purchase price B. Shipping and handling costs paid to acquire the inventory C. Sales commissions paid to personnel who sell inventory to the end consumer D. Costs of leasing the warchouse where the invensory is stored E. None of the above invenoy neponted on the bulence 11. Which of the following inventory cost flow assumptions always results in the highest reponted Cost o Goods Sold? ALIFO B FIFO C. Average cost D. E. Neither-it depends on whether inventory costs have beem rising or falling 12. A LIFO liquidation occurs when uForventory firm: A. Purchases more inventory than it sells in a given period B. Switches from the perpetual to the periodic inventoey costing systom. C. Sells more inventory than it purchases in a given period D. Switches from the periodic to the perpetual inventory costing systcem E. None of the above 13. The contra account to inventory that allows firms to use FIFO for their internal record keepingba report LIFO inventory and COGS on their external financial statements is called: A. The LIFO reserve. B. The LIFO layer C. The LIFO account D. The LIFO liquidator. E. The LIFO FIFO 14. What inventory impairment rule must firms using LIFO use to value their inventiory on the ba sheet? A. The Lower of Cost or Market B. The Lower of Cost or Net Realizable Valuc C. The Lower of Historical or Replacement Cost D. The Cost of First Choice E. None of the Above of inventory's his to: A. Its replacement cost B. Its selling price. C. The selling price less a normal profit margin. D. The selling price less costs of completion and disposal. E. None of the above

Explanation / Answer

Dear Student,

Ans 1) (D) $ 4,000; Varga would recognise $ 4,000 as revenue for 2018 as pro-rata for 8 months when $ 6,000 is for 12 months;

Ans 2) (C) Yes, both quality assurance and extended warranties are considered as performing obligations; being both are the services which would be required to be provided ;

Ans 3) (C) Katy would show a contract asset of $ 6,000 [i.e 20,000 (CIP) less 14,000 (billing)] , and a contract liability of $ 2,000 [i.e. 3,000 (CIP) less 5,000 (biling)]

Ans 4) (A)

For question no 5 to 9 i.e second image the questions are getting blurred out and are not clear when zooming in; Please provide the clear image so that we can help you ASAP;

Ans 10 ) (C) Sales Commission paid to personnel who sell inventory to the end customer should not be included in inventory cost as this cost is the cost incurred on sales;

Ans 11) (B) It would be FIFO because if market prices are increasing the cost of goods produced/sold would be high through this method;

Ans 12) (C) LIFO liquidation occurs when a LIFO inventory firm sells more inventory than it purchases in a given period and thus is forced to liquidate any inventory not sold previously;

Ans 13) (A) It is called LIFO reserve and is equals to FIFO inventory less LIFO inventory;

Ans 14) (B) The Lower of Cost or Net Realisable Value;

Ans 15) (A) Its replacement cost;

Regards,

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