ELF 52) In which of the following situations are a company\'s receivable to anot
ID: 2594955 • Letter: E
Question
ELF 52) In which of the following situations are a company's receivable to another entity? B) assigning C) factoring D) pledging are falling, and inventory levels are stable, the 53) When inventory costs LIFO method will generally result in A) a higher gross profit than under FIFO B) a lower gross profit than under FIFO C) a lower inventory value than under FIFO D) a higher cost of goods sold than under FIFO 54) The balance in the LIFO reserve account is the difference between the beginning inventory and ending inventory measured using FIFO 55) When following U.S.GAAP, the lower-of-cost-or-market rule for inventory requires a firm to report A) the inventory at the higher amount of cost or market on the balance sheet B) the difference between the cost basis and the market-based measure of inventory as a gain on the income statement C) the inventory at cost if the market value of inventory is higher than its cost basis D) the inventory at cost if the market value of inventory is lower than its cost basis 56) An impairment loss for goodwill is calculated as the difference between A) the implied fair value of goodwill and its book value B) the fair value of the reporting unit (including goodwill) and the fair value of its net assets (without goodwill) C) the book value of the reporting unit (including goodwill) and the book value of its net assets (without goodwill) D) the fair value of the reporting unit (including goodwill) and the book value of the reporting unit (without goodwill) Anakwe-Intermediate I, Fall 2017 Final Exam 141PageExplanation / Answer
52) c. Factoring:- under this method the accounts receivebles are sold to another company they are usually called factors they recover the amounts receivable from the and they return back the same to the company the consideration for the entire process is factoring commission.
53) a. Higer gross profit than FIFO :- the reason being when LIFO method of accounting is used to value inventory generally goods comes last will be sent first which means the inventory does not represent current market prices so if the inventory prices falls latest purchased good value is lower and they are sent out which results in goods with more cost which in turn results in higher closing stock then the gross profits shall be natuarally higher than FIFO
54) the LIFO reserve is the difference between the carrying amount of company's inventory under FIFO method and its inventory under LIFO method. LIFO reserve is disclosed by companies that follow LIFO method in accounting for its inventory in order to facilitate the users of financial statements to compare it with companies that might be using FIFO METHOD
55) c. the inventory at cost if the market value is higher than its cost basis.
56) d. it is the difference between tha fair valu and book value of reporting unit is called as impairement loss
Related Questions
Navigate
Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.