Astro company changed its inventory cost flow assumption from FIFO to LIFO in a period of rising prices. What was the result of the change on ending inventory in the year of the change? a. Increased ending inventory b. Decreased ending inventory c. No change in ending inventory d. Can't determine from the information given

Q: n the following information for the Network Company: Date                                    Cost…

A: The right answer is option C c. Inventory       1,050              Income Summary    1,050

Q: If a group of inventory items costing $15,000 had been omitted from the year-end inventory count,…

A: Goods Available for Sale=Beginning Inventory+PurchasesCost of Goods Sold=Beginning…

Q: Which of the following would best explain an decrease in the company's inventory turnover? A. Due…

A: An inventory turnover is defined as the financial ratio, which used to represent how many times the…

Q: Using a periodic inventory system, Bertram Company records inventory at lower of cost or NRV using…

A: Periodic system of inventory is the one which states the inventory under that the updates are made…

Q: Errors were made in each year as follows: in 2020, ending inventory was overstated by $10,600 while…

A: The impact of errors of overstated ending inventory for 2021 profit and owner's equity is shown…

Q: A company has decided to switch from using the FIFO method of inventory valuation to using the…

A: We have the following information:  Opening inventory valued by the FIFO method: $53,200 Closing…

Q: Home Furnishings reports inventory using the lower of cost and net realizable value (NRV). Below is…

A: Total cost recorded cost of ending inventory before any adjustments = (200 x $85) + (50 x $400) =…

Q: An understatement of ending inventory by $2 million in one period results ina. an overstatement of…

A: Inventory is the detailed list of items that are present on hand. It constitute of all the finished…

Q: An understatement of the ending inventory in Year 1, if not corrected, will cause which of the…

A: solution concept Understatement of ending inventory               Ending inventory appears in the…

Q: Jamison Corporation’s inventory cost in its balance sheet is lower using the first-in, first-out…

A: Option b. down is the answer.

Q: Lower of Cost or Market Garcia Company's inventory at the end of the year was recorded in its…

A: Lower of Cost or market (LCM):The lower of cost or market rule states that a business must record…

Q: Loire Co., a calendar year-end firm, has used the FIFO method of inventory measurement since it…

A: Retained Earnings is the part of profit which is not distributed to shareholders as dividend but…

Q: Using a periodic inventory system, Bertram Company records inventory at lower of cost or NRV using…

A: As per accounting standards, inventory has to be reported at lower of cost or NRV. Normally the…

Q: An error in the physical count of goods on hand at the end of the current period resulted in a $3000…

A: Any understatement of  ending inventory results in decrease in net income. In Trading Account…

Q: Hunter, Inc. uses the LIFO method of inventory costing and is facing the possibility of a LIFO…

A: Concept : It occurs when a company using LIFO inventory valuation method sells more goods old stock…

Q: Wakowski Company's ending inventory was actually $86,000 but was adjusted and recorded at year end…

A: It is important that we do not over/understate assets in the Statement of Financial Position. We…

Q: Pierce Ltd. (Pierce) decided to change the costing method for its inventory at its December 31,…

A: Inventories are valued as per the accounting and valuation method followed by the company. There are…

Q: gross profit method assumes

A: The gross profit technique calculates the value of inventory by combining current period data on net…

Q: A company has decided to switch from using the FIFO method of inventory valuation to using the…

A: We have the following information: Opening Inventory (FIFO) : $53,200 Opening Inventory (AVCO) :…

Q: Part One: Explanation 1. If merchandise inventory is being valued at cost and the price level is…

A: FIFO, LIFO and weighted average are different cost flow assumptions with regard to the cost of…

Q: Ann M. Martin Company makes the following errors during the current year.    1.   Overstatement of…

A: Assets, liabilities and stockholders' equity are included in the balance sheet of the company.

Q: If Wakowski Company's ending inventory was actually $86,000 but was adjusted at year end to a…

A: If the inventory is shown as $68,000 instead of $86,000 which shows that the closing inventory is…

Q: A company has decided to switch from using the FIFO method of inventory valuation to using the…

A: AVCO Method:-It is a method known as the Average Cost method, in which the cost of goods sold and…

Q: A company reports inventory using the lower of cost and net realizable value. Below is information…

A: In the balance sheet, we record inventory at cost or NRV whichever is lower. we should record…

Q: Question: Considering the year-ending adjusting journal entries for the periodic inventory system.…

A: Formula: Cost of goods sold= opening inventory+purchases - closing inventory. Gross profit = sales -…

Q: Allied Products maintains a large inventory. The company has used the LIFO inventory method for many…

A: Allied products maintain a large inventory and use the LIFO inventory method for inventory…

Q: Swing Ltd uses FIFO for its inventory, which is valued at $21,000. It is considering a change to…

A: Inventory should be valued at cost or Net realisable value.

Q: Astro Company changed its inventory cost flow assumption from FIFO to LIFO in a period of rising…

A: 1. If a company uses the FIFO method and the prices are rising over a period then it means the Cost…

Q: I'm having issue with the attached screenshot.   Thanks

A: Given information   First Purchase cost $1,180 Second Purchase cost $1,580 Ending inventory 1…

Q: Assuming no beginning inventory, what can be said about the trend of inventory prices if cost of…

A: "Since you have asked multiple questions, we will solve first question for you. If you want any…

Q: A business may need to estimate its amount of inventory because perpetual inventory records are not…

A: Since you have asked multiple questions, we will solve the first question for you. If you want any…

Q: - An analyst observes a decrease in a company's inventory turnover. Which of the following puld most…

A: Solution: Introduction: Inventory turnover ratio measures how well the company's effectiveness in…

Q: The gross profit technique implies that A. The value of the inventory has not grown from prior…

A: The amount of ending inventory for a reporting period is estimated using the gross profit technique.…

Q: A company reports inventory using the lower of cost and net realizable value. Below is information…

A: a. Inventory Cost NRV Cost per unit Quantity Ending inventory A 37 39 37 13 $481 B 44 41 41…

Q: A Retail Company sells various products related to pop culture. Since trends change the market price…

A: The lower cost or market method state that inventory should be valued at lower value from book cost…

Q: A company has decided to switch from using the FIFO method of inventory valuation to using the…

A: FIFO indicates recording the inventory sold at the previous price by assuming that the first…

Q: Which of the following is false? Select one: a. Days’ sales in inventory is equal to the average…

A: Option “B” is False.

Q: Assume that Audio Outfitter Inc. in Discussion Question 9 experienced an abnormal inventory…

A: Adjustment entry for abnormal inventory shrinkage:

Q: Swing Ltd uses FIFO for its inventory, which is valued at $21,000. It is considering a change to…

A: Inventory is either sold or kept as ending inventory. Sold inventory involves the Cost of goods…

Q: If Wakowski Company's ending inventory was actually $86,000 but was adjusted at year end to a…

A: Solution: Small error in inventory valuation would cause a complete error in a financial statement.…

Inventory Valuation

Before discussing the topic inventory valuation let’s discuss the meaning of inventory. In accounting, inventory is also known as stock. Inventory means all the finished goods, materials, merchandise that a business holds for the purpose of selling it in the market with the motive of earning profit.