1. What are the five different criteria discussed in class to be fulfilled if the company

wishes to follow the specific identification method for inventory valuation?

2. James is a new accounting student. He is studying the topic of credit sales and

purchases. While studying the net credit period terms, his understanding is that the

discount period offered to the buyer by the seller in any case has to be greater than the

credit period in order for the buyer to avail the discount. Do you think his

understanding is correct? If yes, why? Give an example.