1. What are the primary goals of inventory managers?

2. Inventory means goods held for sale in the normal course of business or used to produce goods for sale. Define the following:

Merchandise Inventory -

Finished goods inventory -

Consignment inventory -

3. How is inventory categorized on the balance sheet and why?

4. What is the value of the inventory recorded on the balance sheet?

5. When a company sells inventory what is the JE that must be recorded?

6. What is the cost of goods sold (COGS) equation? Solve for the cost of goods sold based on the following information: Beginning inventory = $50,500, Purchases = $700,000, Ending inventory = $ 75,000.

7. Calculate COGS and ending inventory for a perpetual inventory system using the following detail:

Date	Description	Units	Unit Cost	Total Cost
Feb 2	Beginning Bal	200	$3	$ 600
Feb 4	Purchase	100	$5	500
Feb 7	Purchase	300	$4	1,200
Feb 8	Sale	500
Feb 10	Purchase	300	$5	1,500
Feb 12	Sale	300
Feb 15	Purchase	1,000	$2	2,000
Feb 20	Sale	500
Feb 28	Purchase	1,000	$3	3,000

FIFO:

LIFO:

Weighted Average:

8. Which inventory costing method results in the most net income and why?

9. Which inventory costing method results in the lowest ending inventory balance and why?

10. How is the inventory turnover ratio calculated, describing the purpose of this ratio and what result of this calculation indicates to management.