Historical-based costing methods are sometimes criticized for leading to inventory profits. In a period of rising prices,

Question:

Historical-based costing methods are sometimes criticized for leading to inventory profits. In a period of rising prices, which inventory costing method will lead to the most ''inventory profit''? Explain your answer.

Fantastic news! We've Found the answer you've been seeking!

Step by Step Answer:

Related Book For book-img-for-question

Using Financial Accounting Information The Alternative to Debits and Credits

ISBN: 978-1285183237

9th edition

Authors: Gary A. Porter, Curtis L. Norton

See More Books

Question Posted: Aug 12, 2016 11:06 AM

See More Questions

Stephanie and Cody Riley of Newport Rhode Island desire an annual retirement income of 40000 They expect to live for 30 years past retirement Assuming that the couple could earn a 3 percent aftertax...
In a period of rising prices would a company prefer FIFO or LIFO costing? Why?
In a period of rising inventory costs, which cost-flow assumption would produce the highest net income? Why?
Read the case study about Joy Jowie Inc and write a detailed paper about it
Plasma Labs Inc. recently began production of a new product, flat panel displays, which required the investment of $3,000,000 in assets. The costs of producing and selling 20,000 units of flat panel...
Find the range, mean, and standard deviation for the data set. 18, 22, 18, 19, 21, 21, 22, 20, 21, 19
Explain medical staff organization and committee structure.
See if you can determine the amount of Bluebird State Banks current net income after taxes from the figures below (stated in millions of dollars) and the amount of its retained earnings from current...
Suppose the real risk - free rate is 3 . 5 0 % , the average future inflation rate is 2 . 5 0 % , a maturity premium of 0 . 2 0 % per year to maturity applies, i . e . , MRP = 0 . 2 0 % ( t ) , where...
Levoy, Corp., estimates it will produce 25,000 units of an electronic sensor part that goes into one of its final products, called a Fluctotron. It currently produces this sensor internally but is...
After you have gained five years of experience with a large CPA firm, one of your clients, Duke Inc., asks you to take over as chief financial officer for the business. Duke advises its clients on...
Why is it likely that the result from applying the lower-of-cost-or-market rule using a total approach (i.e., by comparing total cost to total market value) and the result from applying the rule on...
Dante's Protein Powder produces a dietary supplement. The standard cost of producing one unit is: Material (1.25 pounds $2.50) ..........................$ 3.13 Labor (1.2 hours $10)...
Content Marketing Institute provides insights on the content marketing habits of nonprofit professionals representing a broad range of nonprofit agencies and organizations. A survey of nonprofit...
A local airline sent out an advertisement via email to its potential customers. It stated that the airline would be holding a lucky draw in which the prizes would be (i) fifteen airline tickets or...
Your one-story house has a floor area of $2.0 \times 10^{2} \mathrm{~m}^{2}$ and 3. 0-m-high ceilings. (a) On a hot day, you leave home with all the windows closed and the air-conditioning on. A...
Recall that Programming Exercise 7 in Chapter 8 asked you to design a program with two parallel arrays: a String array named people and a String array named phone Numbers. The program allows you to...
Assume that money demand takes the form where $Y=1,000$ and $r=0.1$. a. Assume that, in the short run, $\pi^{e}$ is constant and equal to $25 \%$. Calculate the amount of seignorage for each...
A suction device is being designed based on the venturi principle to lift objects submerged in water. The operating water temperature is 15C. The suction cup is located 1 m below the water surface,...
As water moves through the hydrologic cycle, water quality changes are common because of natural phenomena or anthropogenic pollution. Using Figure 11.1, describe how water-quality changes occur...
Upon graduation from MegaState University, you and your roommate decide to start your respective careers in accounting and salmon fishing in Remote, Alaska. Your career as a CPA in Remote is going...
What is the appropriate treatment of any fees or commissions paid to purchase stock in another company?
Accounting for Bad Debts Badger recorded $500,000 of net sales for the year of which 2% is estimated to be uncollectible. Identify and analyze the adjustment required at the end of the year to record...
A representative household maximizes. where . BlogC1+i) j=0 Ct+j+kt+j (3) (4) Note that the second term of the right-hand side of the equation is expressed by not Kt+j-1 but Kt+j-2. In other words,...
Two parallel plates 15 cm on a side are given equal and opposite charges of magnitude 5.5 x 10-9 C. The plates are 3.5 mm apart. What is the potential difference between the plates (in V)? (Enter the...
The equipotential lines in a region of electric field are shown in the diagram below. For each path indicated below, what is the work do by the electric field in moving a charge q = +7.5 x 107 C...

Historical-based costing methods are sometimes criticized for leading to inventory profits. In a period of rising prices,

Question:

Step by Step Answer:

FIFO LIFO and weighted average are all costbased methods to value inventory These three methods assi...View the full answer

Using Financial Accounting Information The Alternative to Debits and Credits

Students also viewed these Cost Accounting questions