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Some Accounting for Inventories questions I have: 1. CAISCO Sales Inc. had a beginning inventory of May comprising of 700 units that had a cost

Some Accounting for Inventories questions I have:

1.

CAISCO Sales Inc. had a beginning inventory of May comprising of 700 units that had a cost of $80/unit. A summary of purchases and sales during the month of May are as follows:

Date Unit Cost Units Purchased Units sold
May 2 400
May 6 $83 1,200
May 10 900
May 19 $85 800
May 23 500
May 30 $88 300

If CAISCO Sales Inc. uses a periodic inventory system, which of the following statements is true?

CAISCO Sales Inc. must use the weighted average cost flow assumption since a perpetual inventory system is used.

CAISCO Sales Inc. must use the FIFO cost flow assumption since a periodic inventory system is used.

None of the other alternatives are correct

CAISCO Sales Inc.'s ending inventory will be higher if FIFO is used than if LIFO is used.

CAISCO Sales Inc.'s ending inventory consists of 1,200 units only if FIFO cost flow method IS assumed.

2.

Chime Inc. counted and valued its inventory using the first-in, first-out (FIFO) cost flow assumption at both December 31, 2004 and 2005 and reported these amounts on its financial statements. While there was no consignment inventory on hand at December 31, 2005, there was at December 31, 2004. If consignment inventory (inventory not belonging to Chime, but stored on its premises), had been inadvertently counted and included in the 2004 inventory valuation, the

inventory would have been understated at December 31, 2005

inventory would have been overstated at December 31, 2005

net income would have been understated in 2004

None of the other alternatives are correct

net income would have been understated in 2005

3.

The following information relates to the inventory of ABC Inc. who uses a perpetual inventory system:
Date Transaction # Units Unit cost/sales price
December 4 Opening inventory 300 $15
December 10 Purchase inventory 100 $18
December 15 Sell inventory 320 $27
December 20 Purchase inventory 150 $20
December 29 Sell inventory 100 $30
What is the value of inventory on hand after the December 29 sale if LIFO is used?
$3,900
$2,600
$1,950
$2,200
$2,400
4.
Meanmocha Hardware has a periodic inventory system and uses the weighted average method. The company began the month of November with 150 large brass switch plates on hand at a cost of $4.00 each. These switch plates sell for $7.00 each. The following schedule sets forth the purchases of switch plates during November:
Date of Transaction Quantity Received Unit Cost
November 7 200 $4.20
November 11 200 $4.40
November 22 250 $4.80
If Meanmocha sells 570 switch plates for $7.00 each during November. What is the company's gross profit for November (rounded to the nearest dollar)?
$1,482
$1,516
$1,528
$1,046
Some other amount

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