financial accounting exam 2 review |\ |\ |\ |\ |\
Rutgers questions with answers |\ |\ |\
Q 6.41: Companies that want to maximize the current
|\ |\ |\ |\ |\ |\ |\ |\ |\
assets section of the balance sheet will use which
|\ |\ |\ |\ |\ |\ |\ |\ |\
inventory cost flow method during deflationary periods? -
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CORRECT ANSWERS ✔✔LIFO |\ |\
Which equation is true regarding inventory? - CORRECT
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ANSWERS ✔✔Ending Inventory + Cost of Goods Sold = |\ |\ |\ |\ |\ |\ |\ |\ |\
Cost of Goods Available for Sale
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Which of the following statements is true? - CORRECT
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ANSWERS ✔✔The first-in, first-out (FIFO) method results |\ |\ |\ |\ |\ |\ |\
in an ending inventory valued at the most recent cost.
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Freight costs to sell goods are characterized as what type
|\ |\ |\ |\ |\ |\ |\ |\ |\ |\
of cost? - CORRECT ANSWERS ✔✔SELLING
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Constant Company uses ________ for income tax purposes
|\ |\ |\ |\ |\ |\ |\
and financial reporting purposes. This is an example of
|\ |\ |\ |\ |\ |\ |\ |\ |\ |\
the __________. - CORRECT ANSWERS ✔✔LIFO; LIFO
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conformity rule. |\
, Which of the following statements is true about the
|\ |\ |\ |\ |\ |\ |\ |\ |\
specific identification method of costing inventories? -
|\ |\ |\ |\ |\ |\ |\
CORRECT ANSWERS ✔✔It tracks the actual physical flow |\ |\ |\ |\ |\ |\ |\ |\
of the goods available for sale.
|\ |\ |\ |\ |\
If the unit cost of inventory is increasing during a period
|\ |\ |\ |\ |\ |\ |\ |\ |\ |\ |\
and all units are not sold, - CORRECT ANSWERS ✔✔a
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company using the LIFO method will report less gross |\ |\ |\ |\ |\ |\ |\ |\ |\
profit for the period than if it had used the FIFO method.
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In periods of rising prices, which inventory method results
|\ |\ |\ |\ |\ |\ |\ |\
in the inventory value reported on the balance sheet
|\ |\ |\ |\ |\ |\ |\ |\ |\ |\
being closest to current cost? - CORRECT ANSWERS
|\ |\ |\ |\ |\ |\ |\ |\
✔✔FIFO
which should they pick if they want their method to
|\ |\ |\ |\ |\ |\ |\ |\ |\ |\
match the physical movement of goods? - CORRECT
|\ |\ |\ |\ |\ |\ |\ |\
ANSWERS ✔✔FIFO |\
CORRECT - CORRECT ANSWERS ✔✔There is no |\ |\ |\ |\ |\ |\ |\
accounting requirement that the cost flow assumption be |\ |\ |\ |\ |\ |\ |\ |\
consistent with the physical movement of the goods. |\ |\ |\ |\ |\ |\ |\
When is the specific identification method of inventory
|\ |\ |\ |\ |\ |\ |\ |\
costing desirable? - CORRECT ANSWERS ✔✔When a
|\ |\ |\ |\ |\ |\ |\
company sells a limited number of high-unit-cost items. |\ |\ |\ |\ |\ |\ |\ |\
Rutgers questions with answers |\ |\ |\
Q 6.41: Companies that want to maximize the current
|\ |\ |\ |\ |\ |\ |\ |\ |\
assets section of the balance sheet will use which
|\ |\ |\ |\ |\ |\ |\ |\ |\
inventory cost flow method during deflationary periods? -
|\ |\ |\ |\ |\ |\ |\ |\
CORRECT ANSWERS ✔✔LIFO |\ |\
Which equation is true regarding inventory? - CORRECT
|\ |\ |\ |\ |\ |\ |\ |\
ANSWERS ✔✔Ending Inventory + Cost of Goods Sold = |\ |\ |\ |\ |\ |\ |\ |\ |\
Cost of Goods Available for Sale
|\ |\ |\ |\ |\
Which of the following statements is true? - CORRECT
|\ |\ |\ |\ |\ |\ |\ |\ |\
ANSWERS ✔✔The first-in, first-out (FIFO) method results |\ |\ |\ |\ |\ |\ |\
in an ending inventory valued at the most recent cost.
|\ |\ |\ |\ |\ |\ |\ |\ |\
Freight costs to sell goods are characterized as what type
|\ |\ |\ |\ |\ |\ |\ |\ |\ |\
of cost? - CORRECT ANSWERS ✔✔SELLING
|\ |\ |\ |\ |\
Constant Company uses ________ for income tax purposes
|\ |\ |\ |\ |\ |\ |\
and financial reporting purposes. This is an example of
|\ |\ |\ |\ |\ |\ |\ |\ |\ |\
the __________. - CORRECT ANSWERS ✔✔LIFO; LIFO
|\ |\ |\ |\ |\ |\ |\
conformity rule. |\
, Which of the following statements is true about the
|\ |\ |\ |\ |\ |\ |\ |\ |\
specific identification method of costing inventories? -
|\ |\ |\ |\ |\ |\ |\
CORRECT ANSWERS ✔✔It tracks the actual physical flow |\ |\ |\ |\ |\ |\ |\ |\
of the goods available for sale.
|\ |\ |\ |\ |\
If the unit cost of inventory is increasing during a period
|\ |\ |\ |\ |\ |\ |\ |\ |\ |\ |\
and all units are not sold, - CORRECT ANSWERS ✔✔a
|\ |\ |\ |\ |\ |\ |\ |\ |\ |\
company using the LIFO method will report less gross |\ |\ |\ |\ |\ |\ |\ |\ |\
profit for the period than if it had used the FIFO method.
|\ |\ |\ |\ |\ |\ |\ |\ |\ |\ |\
In periods of rising prices, which inventory method results
|\ |\ |\ |\ |\ |\ |\ |\
in the inventory value reported on the balance sheet
|\ |\ |\ |\ |\ |\ |\ |\ |\ |\
being closest to current cost? - CORRECT ANSWERS
|\ |\ |\ |\ |\ |\ |\ |\
✔✔FIFO
which should they pick if they want their method to
|\ |\ |\ |\ |\ |\ |\ |\ |\ |\
match the physical movement of goods? - CORRECT
|\ |\ |\ |\ |\ |\ |\ |\
ANSWERS ✔✔FIFO |\
CORRECT - CORRECT ANSWERS ✔✔There is no |\ |\ |\ |\ |\ |\ |\
accounting requirement that the cost flow assumption be |\ |\ |\ |\ |\ |\ |\ |\
consistent with the physical movement of the goods. |\ |\ |\ |\ |\ |\ |\
When is the specific identification method of inventory
|\ |\ |\ |\ |\ |\ |\ |\
costing desirable? - CORRECT ANSWERS ✔✔When a
|\ |\ |\ |\ |\ |\ |\
company sells a limited number of high-unit-cost items. |\ |\ |\ |\ |\ |\ |\ |\
