11. Inventory

Which of the following is included in the definition of inventory?

Which inventory valuation method assumes that the items of inventory purchased first are sold first?

The principle of valuing inventory at the lower of cost or net realizable value is based on which accounting principle?

In the perpetual inventory system, the inventory is updated:

Which of the following methods is NOT permitted under the Accounting Standards for inventory valuation?

Which inventory valuation method is best suited for interchangeable inventory items?

The cost of goods sold can be calculated using the formula:

Under FIFO, the closing inventory is valued based on:

In which method is inventory valued by reducing the selling price of inventory by an estimated percentage of gross margin?

Which of the following costs is NOT included in the cost of inventory?

Inventory is classified as:

In a Periodic Inventory System, the inventory is:

Which of the following statements is TRUE regarding the LIFO inventory valuation method?

What is net realizable value (NRV)?

The Weighted Average Price Method takes into account:

Which of the following costs should be excluded from the cost of inventories?

Which of the following is an example of abnormal wastage that should not be included in inventory costs?

What is the impact of an overstatement of closing inventory on net income?

Which method of inventory valuation matches current costs with current revenues?

Which of the following methods is generally used when goods are not ordinarily interchangeable?

Which method of inventory recordkeeping provides continuous information about inventory levels?

Which of the following formulas is used to calculate the cost of goods sold?

The specific identification method of inventory valuation is most suitable for:

The method where inventory is valued at estimated selling price less estimated costs of completion is called:

Which inventory system requires actual physical count of inventory at the end of an accounting period?

Which cost is included in the inventory cost as per accounting standards?

Which inventory valuation method assumes that the most recently purchased goods are sold first?

If the cost of an item is $100 and its net realizable value is $80, at what value should the item be recorded in the books?

Under which method are inventory costs assigned based on the actual physical flow of goods?

Which inventory valuation method leads to higher inventory values in a period of rising prices?

Which type of inventory typically includes raw materials, workinprogress, and finished goods?

The closing inventory of a trading business consists mainly of:

Which inventory valuation method is prohibited under Accounting Standards due to its mismatching of inventory flow with actual physical movement?

The Adjusted Selling Price Method is primarily used in:

Inventory should be valued at:

Which of the following costs should be considered in the calculation of inventory conversion costs?

A manufacturing company uses the FIFO method. It made the following purchases: 100 units at $10, 200 units at $12. What will be the cost of goods sold for 150 units?

Which method of inventory valuation is most affected by inflation?

Which of the following costs is normally excluded from inventory valuation?

Which of the following methods is not suitable for valuing perishable goods?

Under inflationary conditions, which method will result in the highest reported income?

Which method of inventory record keeping provides more accurate financial information for interim periods?

Which method assumes that the costs of the earliest goods acquired are the first to be charged to cost of goods sold?

If closing inventory is understated, what is the effect on net income?

In a periodic inventory system, what is the formula to calculate the cost of goods sold (COGS)?

Which method is generally used for goods that are interchangeable and frequently purchased?

Which of the following is a nonhistorical cost method?

The valuation of slowmoving inventory is important because:

Under perpetual inventory system, the balance of inventory at any time is:

Which of the following does the periodic inventory system NOT provide?

Which of the following is true for the FIFO method in an inflationary period?

Which inventory system allows realtime tracking of inventory balances?

In the retail method, inventory is valued by:

Which method of inventory valuation is the least appropriate when prices are falling?

A trading company purchased 200 units at $10 each and later purchased 300 units at $12 each. If 250 units were sold, what is the value of closing inventory using FIFO?

Which of the following would cause an increase in cost of goods sold?

Which of the following costs is considered abnormal and should not be included in inventory valuation?

The perpetual inventory system records inventory:

What is the main disadvantage of the periodic inventory system?

In an inflationary environment, which inventory method results in the lowest net income?

Which inventory method best matches current costs with current revenues?

Which inventory valuation method provides the most current inventory value in times of rising prices?

What is the main benefit of using the Specific Identification Method?

Which of the following is NOT an advantage of the perpetual inventory system?

Which of the following methods assumes the cost of the most recent purchases are charged to cost of goods sold first?

Which method of inventory valuation is most appropriate for items that are distinct and easily identifiable, such as cars or real estate?

Which inventory valuation method minimizes the impact of inflation on the cost of goods sold?

Which of the following is a disadvantage of the FIFO method in times of rising prices?

Under the retail inventory method, inventory is valued by applying a:

In a periodic inventory system, when is cost of goods sold determined?

Which of the following is a benefit of the perpetual inventory system?

What effect does an understatement of closing inventory have on the balance sheet?

If ending inventory is overstated, the effect on the next period’s beginning inventory is:

Which of the following statements is true about the LIFO inventory valuation method?

Under a perpetual inventory system, inventory purchases are recorded in:

Which inventory valuation method results in the highest cost of goods sold during inflationary periods?

In which inventory valuation method are the oldest costs assigned to cost of goods sold?

What is the effect of overstating beginning inventory on net income?

Which of the following methods will result in the lowest value for closing inventory during a period of rising prices?

Which method is the best choice for a company that deals with highly perishable goods?

In a perpetual inventory system, what happens when a company purchases inventory?

Which of the following would be most affected by inventory valuation methods in an inflationary environment?

Which inventory system is most likely to detect theft or loss of inventory?

Which inventory valuation method results in a more accurate matching of current costs with current revenues?

The net realizable value of inventory is:

Which inventory method assumes that the most recent items added to inventory are the first to be sold?

Which inventory valuation method is generally preferred during periods of falling prices?

If closing inventory is overstated, what is the effect on gross profit?

Which method is most appropriate for valuing inventory when it is unique and has a high value?

What is the main disadvantage of the LIFO method in terms of inventory valuation?

The weighted average cost method:

Inventory is classified as which type of asset on the balance sheet?

Which inventory valuation method is most commonly used by companies that sell goods that are not interchangeable?

In a periodic inventory system, which account is used to record purchases of inventory?

When inventory is valued at the lower of cost or net realizable value, this is an application of the:

Which of the following inventory valuation methods is likely to give the most accurate picture of replacement cost?

Which method results in lower taxes during periods of rising prices?

Which of the following methods considers the quantities of each purchase to calculate an average cost?

In a perpetual inventory system, the cost of goods sold is determined:

Which of the following is NOT considered part of the cost of inventory?