COMPLETEEeeE SOLUTION PLEASEEE!!!

Assessment- Inventory Valuation

1. Which of the following inventory method reports most closely the current cost of inventory?

a. FIFO c. Weighted average

b. Specific Identification d. LIFO

2. The inventory cost was lower using FIFO than LIFO. If there is no beginning inventory, what direction did the cost of purchases move during the period?

a. Up c. Steady

b. Down d. Cannot be determined

3. An example of inventory accounting policy that should be disclosed is

a. Effect of inventory profit caused by inflation

b. Classification of inventory into raw materials, work in process and finished goods

c. Identification of major suppliers

d. Method used for inventory costing

4. Net realizable value is

a. Current replacement cost

b. Estimated selling price

c. Estimated selling price less estimated cost to complete

d. Estimated selling price less estimated cost to complete and estimated cost to sell

5. This costing method is appropriate for inventories that are segregated for a specific project and inventories that are not ordinarily interchangeable.

a. Specific identification c. Relative sales price

b. Standard cost d. Net realizable value

6. The cost of inventory shall be measured using

a. FIFO c. LIFO

b. Average method d. Either FIFO or average method

7. In a period of falling prices, the use of which inventory cost flow method would typically result in the highest cost of goods sold?

a. FIFO c. Weighted average

b. LIFO d. Specific identification

8. The costing of inventory must be deferred until the end of reporting period under which of the following method of inventory valuation?

a. Moving average c. LIFO perpetual

b. Weighted average d. FIFO perpetual

9. Which is not a required disclosure in relation to inventory?

a. The amount of any writedown of inventories recognized as expense.

b. The amount of any reversal of writedown of inventories

c. The circumstances or events that led to the reversal of a writedown of inventories

d. The fair value less cost to sell of inventories pledged as security for liabilities 10. Which of the following attributes would not be used to measure inventory?

a. Historical cost c. Net realizable value

b. Current replacement cost d. Present value of future cash flows

11. BYS Company provided the following net income and inventory. What is the net income for 2014 using the FIFO cost flow?

	2013		2014
Net income using LIFO	2,750,000		3,000,000
Year-end inventory- FIFO	1,400,000		2,000,000
Year-end inventory- LIFO	900,000		1,600,000
a. 2,900,000	c. 3,500,000
b. 2,600,000	d. 3,100,000

12. On April 1, 2020, Dynamite Company had 6,000 units of merchandise on hand that cost P120 per unit. During the month, the entity had the following transactions with regard to the merchandise: April 5 Purchased on account 15,000 units at P140 per unit, April 8 Returned 1,000 units from the April 5 purchase, April 29 Sold on account 16,000 units at P200 per unit. The entity used a perpetual inventory system and a FIFO cost flow. What is the cost of goods sold for April?

a. 2,120,000 c. 2,144,000

b. 2,200,000 d. 2,080,000

13. Celine Company provided the following data relating to an inventory item.

Under the perpetual system, what is the moving average unit cost on January 31?

Units		Unit Cost		Total Cost
Jan. 1 Beginning balance 5,000		200			1,000,000
10 Purchase 5,000 15 Sale 7,000 16 Sale return 1,000		250			1,250,000
30 Purchase 16,000		150			2,400,000
31 Purchase return 2,000 a. 167 c. 181 b. 165 d. 225		150			300,000

14. In 2020, North Company experienced a decline in the value of inventory resulting in a writedown from P3,600,000 to P3,000,000. The entity used the allowance method in 2020 to record the necessary adjustment. In 2021, market conditions have improved dramatically and the inventory increased to P3,200,000. What is included in the adjusting entry on Dec. 31, 2021?

a. Debit gain on reversal of inventory writedown P200,000

b. Credit gain on reversal of inventory writedown P400,000

c. Debit allowance for inventory writedown P200,000

d. Credit allowance for inventory writedown P400,000

15. On Dec. 31, 2013, Uno Company has outstanding purchase commitments for 50,000 gallons at P20 per gallon of raw material. It is determined that the market price of the raw material has declined to P17 per gallon on Dec. 31, 2013 and it is expected to decline further to P15 in the first quarter of 2014. What is the loss on purchase commitment that should be recognized in 2013?

a. 850,000 c. 250,000

b. 150,000 d. 0

16. Sunny Company provided the ff. data for the current year. What amount should be reported as cost of goods sold?

Inventory - January 1:

Cost			3,000,000
Net realizable value			2,800,000
Net purchases Inventory- December 31:			8,000,000
Cost			4,000,000
Net realizable value			3,700,000
a. 7,000,000		c. 7,300,000
b. 7,100,000		d. 7,200,000

17. Tiffany Company is a wholesaler of photography equipment. The entity used the periodic average cost method to account for inventory. The activity for the inventory of cameras during July is shown below: What is the ending inventory on July 31?

Units Unit Cost

July 1 Inventory 20,000 36.00

7 Purchase 30,000 37.00

12 Sale 36,000

21 Purchase 50,000 37.88

22 Sale 38,000

29 Purchase 16,000 38.11

a. 1,534,000 c. 1,587,360

b. 1,569,120 d. 1,594,640

18. Daenerys Company recorded the following data pertaining to raw material Y during January of the current year. What is the moving average unit cost of the inventory on January 31?

				Units
Date		Received		Cost	Issued	On Hand
1/1 Inventory				200		8,000
1/8 Issue					4,000	4,000
1/20 Purchase		12,000		240		16,000
a. 220		c. 230
b. 224		d. 240

19. The unadjusted physical inventory of Liberty Company at Dec. 31, 2014 was

P3,000,000. Other information follows: 1. Goods were received and recorded on Jan. 2, 2015 with cost of P180,000. Information revealed that the term of the shipment is FOB shipping point and these goods were shipped on Dec. 29, 2014. 2. Merchandise in the warehouse costing P240,000 was billed to the customer FOB shipping point on Dec. 29, 2014. These were excluded from the inventory but these were shipped on Jan. 3, 2015. How much should Liberty report as inventory in its Dec. 31, 2014 statement of financial position?

a. 3,000,000 c. 3,240,000

b. 3,180,000 d. 3,420,000

20. On Oct. 1, 2014, Saint Company consigned 50 sewing machines to Matthew Company for sale at P20,000 each and paid P40,000 in transportation cost. On

Dec. 31, 2014, Matthew reported the sale of 30 sewing machines and remitted P510,000. The remittance was net of the agreed 15% commission. What amount should Saint recognize as consignment sales revenue for 2014?

a. 350,000 c. 510,000

b. 470,000 d. 600,000