21.Which of the following inventory accounting methods must be used for financial reporting purposes if a U.S. firm uses last in, first out (LIFO) for tax purposes?

A)   FIFO.

B)   Average cost.

C)   LIFO.

D)   The firm may use any of the above methods.

22.JME purchased 400 units of inventory that cost $4.00 each. Later the firm purchased an additional 500 units that cost $5.00 each. JME sold 700 units of inventory for $7.00 each. If JME uses a first in, first out (FIFO) cost flow method, the amount of gross profit appearing on the income statement is:

A)   $2,400.

B)   $3,100.

C)   $4,900.

D)   $1,800.

23.JME had beginning inventory of $200 and ending inventory of $300. JME had COGS of $800. JME must have purchased inventory amounting to:

A)   $1,100.

B)   $800.

C)   $900.

D)   $700.

24.An analyst provided the following information about a company:

 Purchases throughout the year        $55,000

 COGS                              $60,000

  Ending inventory                    $35,000

The beginning inventory was:

A)   $45,000.

B)   $50,000.

C)   $40,000.

D)   $55,000.

25.What is the cost of goods sold using the average cost method and using the first in first out (FIFO) method?

A)         $3,604.02                          $2,918.00

B)         $3,604.02                   $3,423.82

C)         $4,142.00                             $3,423.82

D)         $4,142.02                             $2,918.00

答案和详解如下：

21.Which of the following inventory accounting methods must be used for financial reporting purposes if a U.S. firm uses last in, first out (LIFO) for tax purposes?

A)   FIFO.

B)   Average cost.

C)   LIFO.

D)   The firm may use any of the above methods.

The correct answer was C)

If a U.S. firm uses LIFO for tax purposes, it must also use LIFO for financial reporting purposes, according to U.S. tax law.

22.JME purchased 400 units of inventory that cost $4.00 each. Later the firm purchased an additional 500 units that cost $5.00 each. JME sold 700 units of inventory for $7.00 each. If JME uses a first in, first out (FIFO) cost flow method, the amount of gross profit appearing on the income statement is:

A)   $2,400.

B)   $3,100.

C)   $4,900.

D)   $1,800.

The correct answer was D)

(700 × 7.00) – [(400 × 4.00) + (300 × 5.00)] = 1,800

23.JME had beginning inventory of $200 and ending inventory of $300. JME had COGS of $800. JME must have purchased inventory amounting to:

A)   $1,100.

B)   $800.

C)   $900.

D)   $700.

The correct answer was C)

200 + X – 300 = 800

X = purchases = 900

24.An analyst provided the following information about a company:

 Purchases throughout the year        $55,000

 COGS                              $60,000

  Ending inventory                    $35,000

The beginning inventory was:

A)   $45,000.

B)   $50,000.

C)   $40,000.

D)   $55,000.

The correct answer was C)

COGS of $60,000 + ending inventory of $35,000, less purchases of $55,000.

	Units	Unit Price
Beginning Inventory	709	$2.00
Purchases	556	$6.00
Sales	959	$13.00
SGA Expenses	$2,649 per annum

25.What is the cost of goods sold using the average cost method and using the first in first out (FIFO) method?

Average Cost

FIFO

A)         $3,604.02                          $2,918.00

B)         $3,604.02                   $3,423.82

C)         $4,142.00                             $3,423.82

D)         $4,142.02                             $2,918.00

The correct answer was A)

Average cost = cost of goods available/total units available. COGS = Units sold x avg. cost = 959 X 3.7381 = $3,604.02.

FIFO COGS = (709 x 2) + (250 x 6) = $2,918.00.