Q1. Goldberg Inc. produces and sells electronic equipment. Which of the following inventory costs is most likely to be recognized as an expense on Goldberg’s financial statements in the period incurred? A) Conversion cost. B) Selling cost. C) Freight costs on inputs.
Q2. Diabelli Inc. is a manufacturing company that is operating at normal capacity levels. Which of the following inventory costs is most likely to be recognized as an expense on Diabelli’s financial statements when the inventory is sold? A) Administrative overhead. B) Selling cost. C) Allocation of fixed production overhead.
Q3. Markus Ltd. is a manufacturing firm that is operating at 75% of normal capacity in the current year. Its total fixed production overhead cost for the year is $4 million. Which of the following amounts will eventually be recognized as cost of goods sold on the income statement? A) $3 million. B) $1 million. C) $4 million.
Q4. Judah Inc. prepares its financial statements under IFRS. On December 31, 20X8, Judah has inventory of manufactured goods with a cost of $720,000. The estimated selling cost of that inventory is $50,000 and its market value is $740,000. By January 31, 20X9, none of the inventory has been sold but its market value has increased to $810,000. Selling costs remain the same. Which of the following entries is most likely permissible under IFRS? A) Write down inventory by $30,000 on December 31, 20X8 and write up inventory by $70,000 on January 31, 20X9. B) Write down inventory by $30,000 on December 31, 20X8 and write up inventory by $30,000 on January 31, 20X9. C) Make no adjustments to the valuation of inventory on either date.
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发表于 2009-1-19 09:12
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