# Chp 9 accounting

### 61 terms by mgiloi

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### In applying LCM, market cannot be

D. Greater than net realizable value

### In applying LCM, market cannot be

A. Less than net realizable value minus a normal profit margin

C. Yes No

C. Consistency

B. 520000

C. 170

C. 80

D. 235

D. 155

D. 126000

C. 130000

B. 90000

A. 45000

### When using the gross profit method to estimate ending inventory, it is not necessary to know

C. Cost of goods sold

D. 280000

C. 395000

C. 250000

B. 65000

### When computing the cost-to-retail percentage for the conventional retail method, included in the denominators are

C. Net markups, but not net markdowns

### Included in the computation of the cost-to-retail percentage for the LIFO retail method are

A. Net markups and net markdowns

D. Freight-in

### Under the retail inventory method

A. A company measures inventory on its balance sheet by converting retail prices to cost

D. Net markdowns

A. Freight-in

### In determining the cost-to-retail percentage for the current year

A. Net markups are included

C. 29

D. 49800

B. 73700

B. 25000

A. 16000

A. 68200

B. 360000

D. 55%

A. 55000

B 55.6%

### Benny's Bed Co. To the nearest thousand, estimated ending inventory is:

D. None of the above is correct

A. 70%

D. 129000

B. 83500

### When computing the cost-to-retail percentage for the average cost retail method included in the denominator are

A. Net markups and net markdowns

C. Average, LCM

C. 275000

B. 66.7%

D. 30000

A. 54.9%

C. 127000

### Using the dollar-value LIFO retail method for inventory

B. Combines retail LIFO accounting with dollar-value LIFO accounting

### To use the dollar-value LIFO retail method for inventory, the first step is to

C. Determine the cost-to-retail percentage for the current year transactions

### To use the dollar-value LIFO retail method for inventory, the second step is to determine the estimated

D. Ending inventory at base year retail prices

### To determine if an increase in the dollar value of inventory is due to increased quantities, using dollar-value LIFO retail

D. Deflate the ending inventory amount to beginning of year prices and compare to the beginning inventory amount

### To determine the value of a LIFO layer, using dollar-value LIFO retail

C. Multiply the LIFO layer by the layer-year price index and by the layer-year cost-to-retail percentage

A. 150 million

### Harlequin Co. has used the dollar-value LIFO retail method since it began operations in early 2010 (its base year). Its beginning inventory for 2011 was \$36,000 at cost and \$72,000 at retail prices. At the end of 2011, it computed its estimated ending inventory at retail to be \$120,000. Assuming its cost-to-retail percentage for 2011 transactions was 60%, what is the inventory balance that Harlequin Co. would report in its 12/31/11 balance sheet?

D. It can't be determined with the given information

### Retrospective treatment of prior years' financial statements is required when there is a change from

D. All of the above

### Prunedale Co. uses a periodic inventory system. Beginning inventory on January 1 was overstated by \$32,000, and its ending inventory on December 31 was understated by \$62,000. These errors were not discovered until the next year. As a result, Prunedale's cost of goods sold for this year was:

A. Overstated by 94000

### Prunedale Co. uses a periodic inventory system. Beginning inventory on January 1 was understated by \$30,000, and its ending inventory on December 31 was understated by \$17,000. In addition, a purchase of merchandise costing \$20,000 was incorrectly recorded as a \$2,000 purchase. None of these errors were discovered until the next year. As a result, Prunedale's cost of goods sold for this year was:

C. Understated by 31000

B. 20000

C. 180000

B. 440000

D. 490000

B. NRV

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