AAMI ACCOUNTING 2 QUESTIONS WITH ALL
CORRECT & VERIFIED ANSWERS
Total Units Cost divided Total Cost equals Correct answer-Unit Value
Total Units available for sale equals Correct answer-Beginning Inventory + all purchases
FIFO Correct answer-First In Last Out
LIFO Correct answer-Last In First Out
CGS Correct answer-Cost of Goods Sold
Rising market
LIFO: Correct answer-gives Higher (CGS)
Rising market
FIFI: Correct answer-gives Lower (CGS)
Declining market
LIFO: Correct answer-gives Lower (CGS)
Declining market
FIFO Correct answer-gives Higher (CGS)
Higher (CGS) Correct answer-Lower profit
Lower (CGS) Correct answer-Higher profit
Specific Identification Correct answer--Specified identity price/cost of item you sell.
-Most accurate method of inventory valuation
Weighted Average Correct answer-Total cost of goods divided by Total unit
Payroll tax Correct answer-difference between net pay and gross pay and what owner has to match
Depreciation Correct answer-periodic a location of the cost of assets
Depletion Correct answer-allocation of the cost of natural resources such as minerals
Amortization Correct answer-allocation of the cost of intangible assets, such as patents, are
transferred to expense through amortization
Capitalized Cost Correct answer--Cost recorded as part of an asset's cost and depreciated over an
asset's useful life
- Added to the original cost
Straight-Line Method Correct answer--method of computing the amount of depreciation expense
-Same amount of depreciation is recorded for each year
Acquisition Cost-Net Salvage Value
divided by Useful Life In Years Correct answer-Annual deprecation
Entry for depreciation Correct answer-Dr. Depreciation expense
Cr. Accumulated Depreciation
Accumulated Depreciation Correct answer-is a contra account used to record annual depreciation
The entry to record annual depletion & amortization expense Correct answer-the same as the
entry to record Depreciation
Presentation on Financial statements Correct answer-a. Bldg (asset)
b. (Less) accumulated depreciation
c. = Book value
The value that the asset will have at end of life
d. Book Value: BV = assets - accumulated depreciation
e. Salvage Value: SV= predicated value of asset at end of useful life
# of methods of depreciation Correct answer-(4)
Book Value Correct answer-BV = assets - accumulated depreciation
Salvage Value: Correct answer-SV= predicated value of asset at end of useful life
Depreciation
Methods: Correct answer--Straight line method
-Declining- balance method/ double declining method
-Sum of the years digit method
CORRECT & VERIFIED ANSWERS
Total Units Cost divided Total Cost equals Correct answer-Unit Value
Total Units available for sale equals Correct answer-Beginning Inventory + all purchases
FIFO Correct answer-First In Last Out
LIFO Correct answer-Last In First Out
CGS Correct answer-Cost of Goods Sold
Rising market
LIFO: Correct answer-gives Higher (CGS)
Rising market
FIFI: Correct answer-gives Lower (CGS)
Declining market
LIFO: Correct answer-gives Lower (CGS)
Declining market
FIFO Correct answer-gives Higher (CGS)
Higher (CGS) Correct answer-Lower profit
Lower (CGS) Correct answer-Higher profit
Specific Identification Correct answer--Specified identity price/cost of item you sell.
-Most accurate method of inventory valuation
Weighted Average Correct answer-Total cost of goods divided by Total unit
Payroll tax Correct answer-difference between net pay and gross pay and what owner has to match
Depreciation Correct answer-periodic a location of the cost of assets
Depletion Correct answer-allocation of the cost of natural resources such as minerals
Amortization Correct answer-allocation of the cost of intangible assets, such as patents, are
transferred to expense through amortization
Capitalized Cost Correct answer--Cost recorded as part of an asset's cost and depreciated over an
asset's useful life
- Added to the original cost
Straight-Line Method Correct answer--method of computing the amount of depreciation expense
-Same amount of depreciation is recorded for each year
Acquisition Cost-Net Salvage Value
divided by Useful Life In Years Correct answer-Annual deprecation
Entry for depreciation Correct answer-Dr. Depreciation expense
Cr. Accumulated Depreciation
Accumulated Depreciation Correct answer-is a contra account used to record annual depreciation
The entry to record annual depletion & amortization expense Correct answer-the same as the
entry to record Depreciation
Presentation on Financial statements Correct answer-a. Bldg (asset)
b. (Less) accumulated depreciation
c. = Book value
The value that the asset will have at end of life
d. Book Value: BV = assets - accumulated depreciation
e. Salvage Value: SV= predicated value of asset at end of useful life
# of methods of depreciation Correct answer-(4)
Book Value Correct answer-BV = assets - accumulated depreciation
Salvage Value: Correct answer-SV= predicated value of asset at end of useful life
Depreciation
Methods: Correct answer--Straight line method
-Declining- balance method/ double declining method
-Sum of the years digit method
