Acc Chapter 8 Quiz

Ending inventory is equal to the cost of items on hand plus

Items in transit sold f.o.b. destination.

A company that prepares its financial statements according to International Financial Reporting Standards can use each of the following inventory valuation methods except

LIFO

Cost of goods sold is given by:

Net Purchases + beginning inventory - ending inventory.

In a periodic inventory system, the cost of inventories sold is

Not recorded at the time goods are sold.

Inventory does not include

The cost of office equipment.

The use of LIFO in accounting for a firm's inventory

Usually provides a better match of expenses with revenues.

The largest expense on a retailer's income statement is typically:

cost of goods sold

Using the gross method, purchase discounts lost are

included in purchases

In a perpetual inventory system, the cost of purchases is debited to

inventory

In a periodic inventory system, the cost of purchases is debited to:

purchases