12.

Lawson Manufacturing Company has the following account balances at year end:

Office supplies	$ 4,000
Raw materials	27,000
Work-in-process	59,000
Finished goods	109,000
Prepaid insurance	6,000

What amount should Lawson report as inventories in its balance sheet?

A)

$109,000.

B)

$113,000.

C)

$195,000.

D)

$199,000.

13.	Bell Inc. took a physical inventory at the end of the year and determined that $840,000 of goods were on hand. In addition, the following items were not included in the physical count. Bell, Inc. determined that $96,000 of goods purchased were in transit that were shipped f.o.b. destination (goods were actually received by the company three days after the inventory count).The company sold $40,000 worth of inventory f.o.b. destination. What amount should Bell report as inventory at the end of the year?
	A)	$840,000.
	B)	$936,000.
	C)	$880,000.
	D)	$976,000.

Use the following to answer question 14: Hudson, Inc. is a calendar-year corporation. Its financial statements for the years 2018 and 2017 contained errors as follows:

	2018		2017
Ending inventory	$9,000 overstated		$24,000 overstated
Depreciation expense	$6,000 understated		$18,000 overstated

14.	Assume that no correcting entries were made at December 31, 2017. Ignoring income taxes, by how much will retained earnings at December 31, 2018 be overstated or understated?
	A)	$ 3,000 understated
	B)	$22,500 overstated
	C)	$22,500 understated
	D)	$27,000 understated

Use the following to answer question 15: Niles Co. has the following data related to an item of inventory:

Inventory, March 1	400 units @ $2.10
Purchase, March 7	1,400units @ $2.20
Purchase, March 16	280 units @ $2.25
Inventory, March 31	520 units

15.	The value assigned to ending inventory if Niles uses LIFO and the Periodic Inventory System is
	A)	$1,160.
	B)	$1,104.
	C)	$1,092.
	D)	$1,168.

16.	Checkers uses the periodic inventory system. For the current month, the beginning inventory consisted of 7,200 units that cost $12 each. During the month, the company made two purchases: 3,000 units at $13 each and 12,000 units at $13.50 each. Checkers also sold 12,900 units during the month. Using the average cost method, what is the amount of cost of goods sold for the month?
	A)	$167,055.
	B)	$173,700.
	C)	$161,850.
	D)	$167,700.

17.	Chess Top uses the periodic inventory system. For the current month, the beginning inventory consisted of 480 units that cost $65 each. During the month, the company made two purchases: 720 units at $68 each and 360 units at $70 each. Chess Top also sold 1,200 units during the month. Using the average cost method, what is the amount of ending inventory?
	A)	$25,200.
	B)	$81,048.
	C)	$80,160.
	D)	$24,314.

18.	Chess Top uses the periodic inventory system. For the current month, the beginning inventory consisted of 480 units that cost $65 each. During the month, the company made two purchases: 720 units at $68 each and 360 units at $70 each. Chess Top also sold 1,200 units during the month. Using the FIFO method, what is the amount of cost of goods sold for the month?
	A)	$81,048.
	B)	$78,000.
	C)	$81,960.
	D)	$80,160.

19.	Chess Top uses the periodic inventory system. For the current month, the beginning inventory consisted of 480 units that cost $65 each. During the month, the company made two purchases: 720 units at $68 each and 360 units at $70 each. Chess Top also sold 1,200 units during the month. Using the LIFO method, what is the amount of cost of goods sold for the month?
	A)	$81,048.
	B)	$78,000.
	C)	$81,960.
	D)	$80,160.

20.

The following information applied to Howe, Inc. for 2017:

Merchandise purchased for resale	$410,000
Freight-in	8,000
Freight-out	5,000
Purchase returns	2,000

Howe's 2017 inventoriable cost was

A)

$410,000.

B)

$413,000.

C)

$416,000.

D)

$421,000.