Q6. An analyst gathers the following information about a firm: - Last in, first out (LIFO) inventory = $10,000
- Beginning LIFO reserve = $2,500
- Ending LIFO reserve = $4,000
- LIFO cost of goods sold = $15,000
- LIFO net income = $1,500
- Tax rate is 40%
To convert the financial statements to a FIFO basis, the amount the analyst should add to the stockholders' equity is closest to: A) $2,400. B) $2,800. C) $4,000.
Q7. If a company using last in, first out (LIFO) reports an inventory balance of $22,000 and a LIFO reserve of $4,000, the estimated value for the inventory on a first in, first out (FIFO) basis would be:
A) $13,000. B) $26,000. C) $18,000.
Q8. The formula to convert cost of goods sold (COGS) from last in, first out (LIFO) to first in, first out (FIFO) is: A) COGS FIFO = COGS LIFO – decrease in the LIFO reserve. B) COGS FIFO = COGS LIFO + beginning LIFO reserve. C) COGS FIFO = COGS LIFO – increase in the LIFO reserve.
Q9. The year-end financial statements for a firm using last in first out (LIFO) acounting show an inventory level of $5,000, cost of goods sold (COGS) of $16,000, and inventory purchases of $14,500. If the LIFO reserve is $4,000 at year-end and was $1,500 at the beginning of the year, what would the COGS have been using FIFO accounting?
A) $12,000. B) $13,500. C) $18,500.
Q10. First in, first out (FIFO) inventory equals: A) LIFO cost of goods sold − changes in LIFO reserve. B) the change in LIFO reserve − LIFO ending reserve. C) LIFO inventory + LIFO reserve.
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发表于 2009-1-19 09:55
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