Explain the inventory cost flow assumption: FIFO, LIFO, weighted average. Provide examples.
Q: Using the lower of cost or market, what should the total inventory value be for the following items:…
A:
Q: Calculate ending inventory under FIFO and LIFO both with workings
A: Formula: Ending inventory = Beginning inventory + Purchases - sales units
Q: Under which inventory cost flow assumption is the oldest cost of inventory items likely to remain on…
A: Correct option is LIFO
Q: Which of the three methods of inventory costing -FIFO, LIFO, or weighted average cost - will in…
A: FIFO - Inventory purchased first is assumed to be sold first. LIFO - Inventory recently purchased is…
Q: Which of the following is not an inventory method/cost flow assumption? O a. First-in, first-out O…
A: 5 methods for inventory cost are below: The retail inventory method. The specific identification…
Q: a. What is the total cost of the ending inventory according to FIFO? b. What is the total cost of…
A: Ending inventory is computed by adding the beginning inventory and purchases and then subtracting…
Q: Which cost formula for inventory best reflects the current value of inventory on the balance sheet?…
A: inventory valuation methods are based on the flow of inventory. There are mainly four methods of…
Q: Describe diff erent inventory valuation methods (cost formulas).
A: The manner in which an organization calculates the product costs (inventory value assessment)…
Q: calculate the value of closing inventory uing the weighted average cost inventory valuation method
A: Solution: Weighted average cost per unit is computed as = Cost of goods available for sale / units…
Q: By following the LIFO process calculate the Ending inventory value.
A: Introduction: LIFO: LIFO stands for Last in First out. Which means last received inventory to be…
Q: How much is the total cost of inventory to be presented in the financial position of XYZ?
A: Inventory valuation is done by the Business Entity as per the rules prescribed under the Relevant…
Q: On the basis of the following data, determine the value of the inventory at the…
A: Inventories are recognized lower of cost or market. This rule is applied to inventory item-wise.…
Q: is a measure of inventory profitability that relates a gross margin to the cost of the inventory.
A: Inventory profitability means profits related to inventory cost which are calculated using these two…
Q: Determine ending inventory using the dollar-value LIFO inventory method.
A: Dollar-value LIFO method: In this method, the valuation of inventory is calculated on the monetary…
Q: Briefly explain the usefulness of the inventory figure resulting from the application of lower of…
A: Net Realizable Value(NRV) refers to the inventory value which a business entity can realize from…
Q: On the basis of the following data, determine the value of the inventory at the…
A: Note: Under the Lower of cost or Market method, inventory is valued at the lower of the Cost of the…
Q: a. What value should be assigned to the ending inventory using FIFO? b. What value should be…
A: FIFO method: Under this method of inventory valuation, it is assumed that item of inventory…
Q: For commercial reasons, a weighted average and inventory system from lifo fifo should be considered.
A: The LIFO (Last in, first-out) The LIFO accounting method is used to value inventory. This method is…
Q: i. Determine the cost assigned to the ending inventory by using FIFO method of inventory valuation…
A: LIFO means last in first out where as FIFO means first in first out. Inventory and cost of goods…
Q: Which inventory method is being used when the natural flow of goods is followed? a.) Specific ID b.)…
A: Inventory Valuation: - This is defined as the valuation wherein the changes between the value of the…
Q: The cost method that will yield an ending inventory value that is somewhere between possible high…
A: Inventory valuation has 4 Methods - 1. FIFO 2. LIFO 3. Weighted Average 4. Specific Identification…
Q: FIFO method to determine its cost of inventory.
A: Under FIFO method of inventory valuation, goods come first into the store are sold first.
Q: The inventory costing method that reports the most current prices in ending inventory is Oa. average…
A: LIFO: LIFO stands for Last-In, First-Out. In this method inventory purchased at last will be sell…
Q: The inventory evaluation method which does not represent the actual ending inventory value is?…
A: The question is multiple choice question. Required Choose the Correct Option.
Q: Required: Compute the ending inventory cost using a. Moving average method b. FIFO method
A: The inventory can be valued using various method as LIFO, FIFO and average method.
Q: 1. Calculate the value of closing inventory using the Weighted average cost inventory valuation…
A: As per weighted average cost inventory valuation method, cost per unit is calculated by dividing the…
Q: what is the amount allocated to ending inventory on a LIFO basis?
A: Using the LIFO method, the last purchased units are sold first. Periodic inventory records inventory…
Q: Inventory should be measured at lower of fair value and net realizable value of the inventory.
A: The IAS 2 suggests the requirement for the reporting of the inventories. This states that the…
Q: Explain an example how to calculate net cost of inventory.
A: Net Cost of Inventory indicates the actual cost of inventory purchased. Net cost of inventory is…
Q: Which inventory valuation model serves as a middle-of-the-road approach for taxes and income?…
A: When a corporation values its inventory using FIFO, it reports reduced COGS, which boosts its gross…
Q: On the basis of the following data, determine the value of the inventory at the…
A: Item Cost per unit Market value per unit Lower of cost or market value JFW1 $56 $52 $52 SAW9 28…
Q: When using the periodic inventory system and weighted-average inventory costing method, when is the…
A: Periodic inventory system: The method or system of recording the transactions related to inventory…
Q: The following information for Tuell Company is available: 1. Assume…
A: Inventory refers to all of the items, goods, commerce, and materials held by a company for the…
Q: Which inventory cost flow assumption does IFRS not allow? a. Specific identification. b. FIFO. c.…
A: Accounting: It is the process of collecting, recording, analyzing the cost, summarizing cost,…
Q: What is the purpose of disclosing the difference between the reported LIFO inventory amounts and…
A: Perpetual and periodic inventory system: In merchandise business, there are two types of inventory…
Q: How is the net cost of inventory calculated?
A: Merchandise Inventory: Merchandise is the stock of goods bought by a wholesaler, or a retailer, or a…
Q: What is the measurement value of inventory? Select one: a. Expected Value b. Fair Value c.…
A: Inventory are the goods which the businesses held for the sale.
Q: Which of the three methods of inventory costing— FIFO, LIFO, or weighted average cost—will in…
A: First-In-First-out (FIFO): FIFO is a method used for recording inventory sold. In this method the…
Q: - ending inventory for Steele Ltd. Using the variable
A: Under variable costing, product cost include variable costs only.
Q: Determine the value of the inventory at the lower of cost or market by applying lower of cost or…
A:
Q: Question: Explain the First-In, First-Out (FIFO) method used for determining COGS and Ending…
A: The inventory can be valued using various methods as FIFO, LIFO, average method.
Q: Which of the following inventory method measures most closely the current cost of inventory? a.…
A: The inventory valuation is carried out at the end of the accounting period. The different inventory…
Q: The inventory valuation method which assumes that the items purchased first are the first items to…
A: Valuation of an inventory depends upon which items are sold first in the inventory cycle. This gives…
Q: On the basis of the following data, determine the value of the inventory at the lower of cost or…
A: Lower-of-cost-or-market value:The lower-of-cost-or-market value is a method which requires the…
Explain the inventory cost flow assumption: FIFO, LIFO, weighted average. Provide examples.
Trending now
This is a popular solution!
Step by step
Solved in 2 steps
