a. 5. In the period of declining prices, which of the following inventory methods generally results in the lowest income statement amount of Cost of goods sold? FIFO b. LIFO c. Weighted Average Cost d. Specific Identification 6. Bright Eyes uses a periodic inventory system. When employees count the inventory on December 31, 2019, they accidentally count one box of eyeglasses twice, resulting in 2019 ending inventory being overstated by $10,000. The employees count the December 31, 2020 inventory correctly. Which of the following statements is true related to Bright Eyes' 2020 and 2019 financial statements? 2019 Cost of Goods Sold will be overstated by $10,000. b. 2019 Beginning Inventory will be understated by $10,000. c. 2020 Cost of Goods Sold will be overstated by $10,000. d. 2020 Beginning Inventory will be understated by $10,000. None of the above are true. a. e. Use PVH Corp.'s most recent financial statements to answer the following three questions. 7. Which inventory cost flow assumption does PVH use to value inventories in North America? a. FIFO b. LIFO Weighted Average Cost d. Specific Identification c. a. 8. What is the most likely reason that PVH chose this inventory cost flow assumption (given rising price trend)? To report higher Net Income on its Income Statement. b. To report higher Total Assets on its Balance Sheet. c. To pay less taxes. d. Both a and b are true. 9. Which of the following statements is TRUE regarding PVHs Income Statement? a. Fiscal year 2019 COGS > Fiscal year 2018 COGS. b. Fiscal year 2018 Gross Profit Fiscal year 2018 Gross Profit. d. Fiscal year 2019 Operating Income > Fiscal year 2018 Operating Income. Both a and care true. c. e. PVH Corp. Financial Statements (partial) PVH Consolidated Income Statements In millions of dollars Year ended Feb. 2, 2020 $9.909 Year ended Feb. 3, 2019 $ 9.657 Year ended Feb. 4, 2018 $ 8,915 Sales Cost of goods sold Selling, general, and administrative expenses 4,521 4,349 4,715 4,433 4,020 4,245 PVH As of Feb. 3, 2019 $ 452 Consolidated Balance Sheets In millions of dollars As of ASSETS Feb. 2, 2020 Cash and cash equivalents $ 503 Accounts receivable, net 741 Inventories 1,616 Prepaid expenses and other current assets 534 Total current assets $ 3394 778 1,732 277 $ 3.239 Notes to Consolidated Financial Statements (partial) Footnote 1. Summary Of Significant Accounting Policies 1.1. Description of Business PVH Corp. constitutes a global apparel company with a brand portfolio consisting of nationally and internationally recognized trademarks, including TOMMY HILFIGER, CALVIN KLEIN, Van Heusen, IZOD, ARROW, Warner's, Olga, True&Co. and Geoffrey Beene, which are owned, as well as various other owned, licensed and, to a lesser extent, private label brands. The Company designs and markets branded dress shirts, neckwear, sportswear (casual apparel), jeanswear, performance apparel, intimate apparel, underwear, swimwear, swim products, handbags, accessories, footwear and other related products and licenses its owned brands globally over a broad array of product categories and for use in numerous discrete jurisdictions. 1.4. Fiscal Year The Company uses a 52-53 week fiscal year ending on the Sunday closest to February 1. Results for fiscal years 2019, 2018 and 2017 represent the 52 weeks ended February 2, 2020, 52 weeks ended February 3, 2019 and 53 weeks ended February 4, 2018, respectively. 1.9. Inventories Inventories are comprised principally of finished goods and are stated at the lower of cost or net realizable value. Cost for substantially all wholesale inventories in North America and certain wholesale and retail inventories in Asia is determined using the first-in, first-out method. Cost for all other inventories is determined using the weighted average cost method