WGU Inventory STUDY GUIDE Exam | Questions
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Terms in this set (27)
1/1 Average
A business whose inventory consists Correct. The average-cost method prices items in
of similar items would be most likely the inventory on the basis of the average cost of all
to use which cost flow assumption? similar goods available during the period.
The costing of issues from inventory Weighted-average
must be deferred until the end of the Correct. Using the weighted-average method, a
accounting period under which company must wait until the end of the period to
method of inventory valuation? the value of the ending inventory because it needs
to wait for all transactions to be complete to
include those transactions in the valuation
calculation.
, 1/1 $1,104
Niles Co. has the following data Correct. Niles has 520 units left in ending inventory.
related to an item of inventory: Under LIFO, the inventory is valued by using the
Inventory, March 1: 400 units @ $2.10 cost of the first items in. 400 @ $2.10 ($840) plus
Purchase, March 7: 1,400 units @ 120 @ $2.20 ($264) = $1,104
$2.20
Purchase, March 16: 280 units @
$2.25
Inventory, March 31: 520 units
What is the value assigned to the
ending inventory if Niles Co. uses
LIFO?
Which inventory costing procedures FIFO
would the first (oldest) costs Correct. Under FIFO, the first (oldest) items are
incurred rarely have an effect on the removed from inventory and would, therefore, have
ending inventory value? no effect on the value of the ending inventory.
1/1 Specific identification
Which cost flow assumption would Correct. The specific identification method is used
be most appropriate when a by companies that handle a relatively small number
relatively small number of costly, of costly, easily distinguishable items. The average-
easily distinguishable items are sold? cost method prices items in the inventory on the
basis of the average cost of all similar goods
available during the period.
0/1 If the book value is computed under the FIFO
When would the book value of the method
inventory of material at year end be Correct. The acquisition cost of a certain raw
the same if perpetual records are material changes frequently. The only time the
kept as it would be under a periodic book value of the inventory at year end under a
inventory method? periodic inventory method will match that of a
perpetual method will be if it is computed using
FIFO.
and Answers | Verified Solutions | 2026 Edition |
Pass Guaranteed
Save
Terms in this set (27)
1/1 Average
A business whose inventory consists Correct. The average-cost method prices items in
of similar items would be most likely the inventory on the basis of the average cost of all
to use which cost flow assumption? similar goods available during the period.
The costing of issues from inventory Weighted-average
must be deferred until the end of the Correct. Using the weighted-average method, a
accounting period under which company must wait until the end of the period to
method of inventory valuation? the value of the ending inventory because it needs
to wait for all transactions to be complete to
include those transactions in the valuation
calculation.
, 1/1 $1,104
Niles Co. has the following data Correct. Niles has 520 units left in ending inventory.
related to an item of inventory: Under LIFO, the inventory is valued by using the
Inventory, March 1: 400 units @ $2.10 cost of the first items in. 400 @ $2.10 ($840) plus
Purchase, March 7: 1,400 units @ 120 @ $2.20 ($264) = $1,104
$2.20
Purchase, March 16: 280 units @
$2.25
Inventory, March 31: 520 units
What is the value assigned to the
ending inventory if Niles Co. uses
LIFO?
Which inventory costing procedures FIFO
would the first (oldest) costs Correct. Under FIFO, the first (oldest) items are
incurred rarely have an effect on the removed from inventory and would, therefore, have
ending inventory value? no effect on the value of the ending inventory.
1/1 Specific identification
Which cost flow assumption would Correct. The specific identification method is used
be most appropriate when a by companies that handle a relatively small number
relatively small number of costly, of costly, easily distinguishable items. The average-
easily distinguishable items are sold? cost method prices items in the inventory on the
basis of the average cost of all similar goods
available during the period.
0/1 If the book value is computed under the FIFO
When would the book value of the method
inventory of material at year end be Correct. The acquisition cost of a certain raw
the same if perpetual records are material changes frequently. The only time the
kept as it would be under a periodic book value of the inventory at year end under a
inventory method? periodic inventory method will match that of a
perpetual method will be if it is computed using
FIFO.
