Devry Acct212 Week 4 Checkpoint Latest 2015 October

Devry Acct212 Week 4 Checkpoint Latest 2015 October

1. Question : (TCO 4) The cost of the inventory that the business has
sold to customers is called

Student Answer: inventory.

cost of goods sold.

purchases.

gross profit.

Instructor Explanation: See Chapter 6.

Points Received: 3 of 3
Comments:

Question 2. Question
: (TCO 4) The cost of inventory
that is still on hand and has not been sold to customers is called

Student Answer: cost of goods sold, an expense that appears
on the balance sheet.
inventory, a current asset that appears on
the income statement.

inventory, a current asset that appears on
the balance sheet.

purchases, an expense that appears on the
income statement.

Instructor Explanation: See Chapter 6.

Points Received: 3 of 3
Comments:

Question 3. Question
: (TCO 4) The inventory system
that uses computer software to keep a running record of inventory on hand is
the

Student Answer: cost of goods sold inventory system.

periodic inventory system.

perpetual inventory system.

hybrid inventory system.

Instructor Explanation: See Chapter 6.

Points Received: 3 of 3
Comments:

Question 4. Question
: (TCO 4) The cost of inventory
is the

Student Answer: purchase price.

sum of all the costs incurred to bring the
inventory to its intended use.
sum of all the costs incurred to bring the
inventory to its intended use, plus any discounts and allowances.
sum of all the costs incurred to bring the
inventory to its intended use, less any discounts and allowances.
Instructor Explanation: See Chapter 6.

Points Received: 0 of 3
Comments:

Question 5. Question
: (TCO 4) ABC Auto Sales sells
new Lexus vehicles. ABC will most likely use the _____ method to cost its
ending inventory.

Student Answer: first-in, first-out

last-in, first-out

specific-unit-cost

weighted-average

Instructor Explanation: See Chapter 6.

Points Received: 3 of 3
Comments:

Question 6. Question
: (TCO 4) To determine cost of
goods sold under the FIFO method

Student Answer: the first costs into inventory are the first
costs assigned to cost of goods sold.
the last costs into inventory are the first
costs assigned to cost of goods sold.
the average cost of the inventory must be
determined.

the company must first determine the specific
units sold.

Instructor Explanation: See Chapter 6.

Points Received: 3 of 3
Comments:

Question 7. Question
: (TCO 4) Under the _____
method, ending inventory is based on the costs of the most recent purchases.

Student Answer: average-cost

FIFO

LIFO

specific-identification

Instructor Explanation: See Chapter 6.

Points Received: 3 of 3
Comments:

Question 8. Question
: (TCO 4) The _____ principle
states that the financial statements of a business must report enough
information for outsiders to make knowledgeable decisions about the business.

Student Answer: consistency

historical cost

disclosure

conservatism

Instructor Explanation: See Chapter 6.

Points Received: 3 of 3
Comments:

Question 9. Question
: (TCO 4) The
lower-of-cost-or-market rule requires a company to report inventories at the
lower of

Student Answer: historical cost or current sales price.

historical cost or current replacement cost.

current replacement cost or sales invoice
price.

FIFO cost or LIFO cost.

Instructor Explanation: See Chapter 6.

Points Received: 3 of 3
Comments:

Question 10. Question
: (TCO 4) The inventory turnover
ratio

Student Answer: is determined by dividing cost of goods sold
by net sales.

shows how many times the company sold its
average level of inventory.
should be high for a company that sells
high-priced inventory items.
will be lower for companies that have many
low-priced items in their inventory .
Instructor Explanation: See Chapter 6.

Points Received: 3 of 3
Comments: