multiple choose questions

Project Description:

1 - the following information was available from the inventory records of rich company for january:
units unit cost total cost
balance at january 1 3,000 $9.77 $29,310
january 6 2,000 10.30 20,600
january 26 2,700 10.71 28,917

january 7 (2,500)
january 31 (4,300)
balance at january 31 900
assuming that rich does not maintain perpetual inventory records, what should be the inventory at january 31, using the weighted-average inventory method, rounded to the nearest dollar?
a. $9,454.
b. $9,213.
c. $9,234.
d. $9,324.

2 - on september 19, 2012, mccoy co. purchased machinery for $285,000. salvage value was estimated to be $15,000. the machinery will be depreciated over eight years using the sum-of-the-years'-digits method. if depreciation is computed on the basis of the nearest full month, mccoy should record depreciation expense for 2013 on this machinery of
a. $61,354.
b. $58,267.
c. $58,125.
d. $52,500.

3 - myers company acquired machinery on january 1, 2007, which it depreciated under the straight-line method with an estimated life of fifteen years and no salvage value. on january 1, 2012, myers estimated that the remaining life of this machinery was six years with no salvage value. how should this change be accounted for by myers?
a. as a prior period adjustment
b. as the cumulative effect of a change in accounting principle in 2012
c. by setting future annual depreciation equal to one-sixth of the book value on january 1, 2012
d. by continuing to depreciate the machinery over the original fifteen year life

4 - in january, 2012, yoder corporation purchased a mineral mine for $5,100,000 with removable ore estimated by geological surveys at 2,000,000 tons. the property has an estimated value of $300,000 after the ore has been extracted. the company incurred $1,500,000 of development costs preparing the mine for production. during 2012, 500,000 tons were removed and 400,000 tons were sold. what is the amount of depletion that yoder should expense for 2012?
a. $960,000
b. $1,200,000
c. $1,260,000
d. $1,680,000

5 - the gross profit method of inventory valuation is invalid when
a. a portion of the inventory is destroyed.
b. there is a substantial increase in inventory during the year.
c. there is no beginning inventory because it is the first year of operation.
d. none of these.

6 - the sale of a depreciable asset resulting in a loss indicates that the proceeds from the sale were
a. less than current fair value.
b. greater than cost.
c. greater than book value.
d. less than book value.
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