1. Which of the following inventory valuation methods is only an estimate of actual costs?

Multiple Choice

Only the retail method.

Only the gross profit method.

Both retail and gross profit methods are only estimations.

Neither the retail nor the gross profit methods are estimations.

2.

Which of the four inventory approaches transfers the most recent purchase cost to the cost of goods sold and the remaining items in inventory are valued at the oldest acquisition costs?

Multiple Choice

LIFO

FIFO

Average cost

Specific identification

3.

The specific identification method is more appropriate than a cost flow assumption method:

Multiple Choice

For a large inventory of identical low-priced items.

If each item in the inventory is unique.

If purchase costs are rising.

If purchase costs are falling.