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Accounting Quiz

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Question

1. Under the LIFO method, the flow of goods through the accounting records will;A) be nearly the opposite of the physical flow of goods through the business.;B) closely match the physical flow of goods through the business.;C) exactly match the physical flow of goods through the business.;D) have no relationship to the physical flow of goods through the business.;2. Under the average cost method, the flow of goods through the accounting records will;A) be the opposite of the physical flow of goods through the business.;B) closely match the physical flow of goods through the business.;C) exactly match the physical flow of goods through the business.;D) have no relationship to the physical flow of goods through the business.;3. Under the FIFO method, the flow of goods through the accounting records will;A) be the opposite of the physical flow of goods through the business.;B) closely match the physical flow of goods through the business.;C) exactly match the physical flow of goods through the business.;D) have no relationship to the physical flow of goods through the business.;4. ___________ produces the lowest cost of goods sold and the highest gross profit when prices are increasing.;A) FIFO;B) LIFO;C) Average cost;D) Specific identification;5. __________ produces the highest cost of goods sold and the lowest gross profit when prices are increasing.;A) FIFO;B) LIFO;C) Average cost;D) Specific identification;6. A drawback to using ________________ when inventory costs are rising is that the company reports lower net income.;A) LIFO;B) FIFO;C) average costing;D) specific-identification costing;7. An error in the reported inventory will cause errors in all of the following EXCEPT the;A) balance sheet.;B) statement of retained earnings.;C) following year?s financial statements.;D) cash account.;8. The inventory system that uses the merchandise inventory account as an active account is called the;A) periodic system.;B) perpetual system.;C) LIFO system.;D) FIFO system.;9. Goods such as milk, bread, and cheese would probably be costed using the;A) LIFO method of inventory costing.;B) FIFO method of inventory costing.;C) average method of inventory costing.;D) specific-identification method of inventory costing.;10. Cost of goods sold is shown on the;A) balance sheet as an asset.;B) income statement before gross profit.;C) statement of retained earnings.;D) income statement after gross profit.

 

Paper#78896 | Written in 18-Jul-2015

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