The following information pertains to Sooner Company:May 1 Customer ordered an installation service to be done by Sooner Company on May 15.

The following information pertains to Sooner Company:

May 1 Customer ordered an installation service to be done by Sooner Company on May 15.

May 2 Customer paid cash for the installation job to be done on May 15.

May 8 The Sooner Company purchased installation supplies on account for the job.

May 15 The installation job was started and completed.

May 20 Amount owed for supplies purchased on May 8 is paid.

Assuming that Sooner Company uses accrual-basis accounting, when would the company record the expense related to the supplies?

A) May 2.

B) May 8.

C) May 15.

D) May 20.

Answer: C

For the month of September, the company sold 35 units. What is cost of goods sold under the weighted-average cost method? (Round weighted-average unit cost to 4 decimals)

A) $121.

B) $116.

C) $124.

D) $131.

Answer: $121.

FIFO is considered a balance-sheet approach for reporting inventory because it:

A) Better approximates the value of ending inventory.

B) Always results in a lower amount of inventory being reported.

C) Better approximates inventory cost necessary to generate revenue.

D) Always results in a higher amount of inventory being reported

Answer: Better approximates the value of ending inventory.

Which inventory method is better described as having a balance-sheet focus and why is it considered as such?

A) FIFO; better approximates the value of ending inventory.

B) LIFO; better approximates the value of ending inventory.

C) LIFO; better approximates inventory cost necessary to generate revenue.

D) FIFO; better approximates inventory cost necessary to generate revenue.

Answer: FIFO; better approximates the value of ending inventory.

What is the ending inventory balance for Julia & Company assuming that it uses FIFO?

A) $125.

B) $100.

C) $110.

D) $85.

Answer: $85.

LIFO is considered an income-statement approach for reporting inventory because it:

A) Always results in a higher amount of net income being reported.

B) Better approximates the value of ending inventory.

C) Better approximates inventory cost necessary to generate revenue.

D) Always results in a lower amount of net income being reported.

Answer: Better approximates inventory cost necessary to generate revenue.

Marvin sold 2,300 units of inventory during the month. Ending inventory assuming weighted-average cost would be:

Marvin sold 2,300 units of inventory during the month. Ending inventory assuming weighted-average cost would be: (Round weighted-average unit cost to 4 decimals)

A) $5,087.

B) $5,107.

C) $5,077.

D) $5,005.

Answer: $5,087.

Marvin sold 2,300 units of inventory during the month. Ending inventory assuming FIFO would be:

A) $5,140.

B) $5,080.

C) $5,060.

D) $5,050.

Answer: $5,140.

Marvin sold 2,300 units of inventory during the month. Cost of goods sold assuming FIFO would be:

A) $16,800.

B) $16,760.

C) $16,540.

D) $16,660.

Answer: $16,660.

Dunbar sold 700 units of inventory during the month. Cost of goods sold assuming weighted-average cost would be

Dunbar sold 700 units of inventory during the month. Cost of goods sold assuming weighted-average cost would be: (Round weighted-average unit cost to 4 decimals)

A) $1,711.

B) $1,700.

C) $1,720.

D) $1,708.

Answer: $1,711.

Dunbar sold 700 units of inventory during the month. Ending inventory assuming weighted-average cost would be: (Round weighted-average unit cost to 4 decimals)

A) $502.

B) $490.

C) $489.

D) $480.

Answer: $489.

Dunbar sold 700 units of inventory during the month. Cost of goods sold assuming LIFO would be:

A) $1,730.

B) $1,700.

C) $1,720.

D) $1,710.

Answer: $1,720.

Dunbar sold 700 units of inventory during the month. Ending inventory assuming FIFO would be:

A) $500.

B) $490.

C) $470.

D) $480.

Answer: $500.

Marvin sold 2,300 units of inventory during the month. Ending inventory assuming LIFO would be:

A) $5,040.

B) $5,055.

C) $5,075.

D) $5,135.

Answer: $5,040.

Marvin sold 2,300 units of inventory during the month. Cost of goods sold assuming LIFO would be:

A) $16,800.

B) $16,760.

C) $16,540.

D) $16,660.

Answer: $16,760.

The inventory cost flow assumption that is least likely to match the physical flow of inventory for most companies is:

A) FIFO.

B) LIFO.

C) Weighted-average.

D) Specific identification.

Answer: LIFO.

Dunbar sold 700 units of inventory during the month. Cost of goods sold assuming FIFO would be:

A) $1,730.

B) $1,700.

C) $1,720.

D) $1,710.

Answer: $1,700.

Dunbar sold 700 units of inventory during the month. Ending inventory assuming LIFO would be:

A) $500.

B) $490.

C) $470.

D) $480.

Answer: $480.

At what amount would Shoeless report cost of goods sold using the weighted-average cost flow assumption?

A) $110.

B) $73.

C) $70.

D) $105.

Answer: $105.

At what amount would Shoeless report gross profit using LIFO cost flow assumptions?

A) $105.

B) $80.

C) $175.

D) $120.

Answer: $80

At what amount would Shoeless report ending inventory using FIFO cost flow assumptions?

A) $55.

B) $170.

C) $110.

D) $70.

Answer: $110.