Accounting

Perpetual inventory system the inventory account is:

Continually adjusted

Associated with land acquisition:

Cost of land improvements Delinquent property taxes property tax for current year

Inventory consists of 98500 distinct low cost items. Unlikely to utilize specific identification method because

Costs associated with using the method would likley exceed it's benefits

Purchases land to be used for a new storage facility. Capitalized in cost of land?

Costs to remove an old building Commissions Legal fees to secure title

Which inventory costing method assumes that the inventory's costs flow out in the same order the goods are received?

FIFO

The inventory cost flow assumption must match the physical flow of inventory units.

False

Classification of equipment:

Furniture and fixtures, computers and printers used in office, machinery used in manufacturing

Assuming that prices rise over time, which inventory cost flow assumption will result in the lowest ending inventory?

LIFO

Capitalized in cost of equipment:

Purchase price Insurance on equipment during shipping Installation and testing of equipment Freight to deliver to equipment to it's location

Where is inventory classified in the financial statements?

current asset in the balance sheet

capitalized cost of acquiring building

delinquent property taxes legal fees to obtain title Purchase price

Cost of land is capitalized, but cost of land improvements are capitalized and ?

depreciated

costs that produce benefits only in current period are?

expensed

Capitalized in cost of equipment

installation and testing of equipment Freight to deliver the equipment Legal fees to establish title

differnce btw land and land improvements

land has an indefinite life

noncurrent tangible

property and equipment

The type of income statement that does not classify items as operating and nonoperating is the ____ income statement.

single step