1 The assignment of costs to cost of goods sold and to inventory using specific identification is the same for both the perpetual and periodic systems. T or F
2 The inventory valuation method that results in the lowest taxable income in a period of inflation is:
| A. LIFO method | |
| B. FIFO method | |
| C. Weighted-average cost method | |
| D. Specific identification method | |
| E. Gross profit method |
3During a period of steadily rising costs, the inventory valuation method that yields the lowest reported net income is:
| A. Specific identification method | |
| B. Average cost method | |
| C. Weighted-average method | |
| D. FIFO method | |
| E. LIFO method |
4A company had inventory on November 1 of 5 units at a cost of $20 each. On November 2, they purchased 10 units at $22 each. On November 6 they purchased 6
units at $25 each. On November 8, 8 units were sold for $55 each. Using the FIFO perpetual inventory method, what was the value of the inventory on November 8
after the sale?
| A. $304 | |
| B. $296 | |
| C. $288 | |
| D. $280 | |
|
E. $276 |
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