If a company has three lots of products for sale, purchase 1 (earliest) for $17, purchase 2 (middle) for $15, purchase 3 (latest) for $12, which of the following statements is true? A.This is a deflationary cost pattern. B.The next purchase will cost less than $12. C.This is an inflationary cost pattern. D.None of these statements can be verified.

Q: Fill in the missing amounts in each of the eight case situations below. Each case is independent of…

A:

Q: AD, Inc. uses the LIFO-lower of cost or market method to value inventory. If the inventory value is…

A: For financial reporting purposes, will value the inventory in accounting at lower prices or on the…

Q: 10. In a period of rising prices, the FIFO method of costing inventory results in income tax savings…

A: In the First in first out (FIFO) method, the goods which are purchased first are sold out first, so…

Q: Which of the following is an assumption of cost-volume-profit analysis? a. The inventory quantities…

A: Whereas fixed costs remain constant, variable costs change in proportion to the volume of…

Q: Choose the best answer for each of the following multiple-choice questions.1. Cost-volume-profit…

A: Since you have asked multiple questions, we will solve the first question for you. If you want any…

Q: Which one of the following is not considered an assumption of cost-volun O a. Fixed cost per unit is…

A: Option E is the correct answer i.e Cost can be Divided into variable and fixed components.

Q: e the company's overall profit if it sells exactly the break-even qua

A: Breakeven Point is a point at which the company makes no profit or loss. It is where the…

Q: Contrast the income statement effect of LIFO versus FIFO(on Cost of Goods Sold and Gross Profit)…

A: Last-in-First-Out (LIFO): In this method, items purchased recently are sold first. So, the value of…

Q: Which of the following statements is most correct?

A: Current Ratio: It is a measure of liquidity and the capability of a firm to pay its short-term…

Q: Which of the following is not an assumption underlying cost-volume-profit analysis? a. The sales mix…

A: Solution: Introduction: Cost Volume Profit (CVP) Analysis describes how changes in costs, expenses…

Q: Like many technology companies, TechnoTools operates in an environment of decliningprices. Its…

A: The last in, first-out (LIFO) is a system utilized to store reports of the latest items first…

Q: Which of the following is not a disadvantage of using the FIFO cost flow assumption? includes all…

A: Lets understand the basics.There are various methods follow to calculate inventory balance. It…

Q: When the return on sales (also known as net profit margin) is negative, what does this mean? Group…

A: Net profit margin (NPM) or return on sales measures the profitability of the company. Higher the…

Q: . Which of the following costs will tend to increase if a firm switches to a restrictive short-term…

A: Answer: The correct option would be option C (I, III, and IV only). Introduction: Restrictive policy…

Q: Which of the following is not a correct definition of the breakeven point? A.the point where total…

A: At Breakeven Point, Total Profits are equal to zero, Contribution Margin equal to Total Fixed…

Q: Why does the presence of fixed costs cause the percent-of-sales method of pro forma income statement…

A: Forecasting techniques are methods used to predict future trends or events based on past data and…

Q: Which of the following is not an underlying assumption of a conventional CVP analysis? Multiple…

A: Cost-volume-profit analysis is the most important tool that is used by managers to specify the cost…

Q: True False 1. During a period of rising costs, the LIFO cost flow assumption results in lower cost…

A: LIFO means last in first out where as FIFO means first in first out. Inventory and cost of goods…

Q: Margin of Safety (MOS) in dollars indicates how much sales must decrease before the company will be…

A: Margin of safety is the excess of actual revenue over its break even revenue.

Q: Which of the following statements about the quality of earnings ratio is true? Multiple Choice…

A: Lets understand the basics. Quality of earning ratio indicates the cashflow from operating activity…

Q: Which one of the following is not considered an assumption of cost-volume-profit analysis? a. Costs…

A: Cost volume profit analysis is also known as CVP analysis. It shows how profits of the organisation…

Q: Which of the following performance measures will increase if inventory decreases and all else…

A: Return on investment measures the net earned on the assets employed by the business.

Q: During a period of rising inventory costs and stable output prices, describe how net income and…

A: First in first out Method (FIFO) First in first out method is one of the popular method which was…

Q: Zimt AG uses the FIFO method, and Nutmeg Inc. uses the LIFO method. Compared tothe cost of replacing…

A: If a company follows FIFO method, then the inventory will go based on first in first out. If a…

Q: Which of the following would lead to the breakeven point of a product shifting to the left on a…

A: Break-even analysis is done in order to find out at what point the total cost will be equal to the…

Q: Let P(x) be the annual profit for a certain product, where x is the amount of money spent on…

A: Solution- (A)  P(o) represents the amount of annual profit allocated when x=0 or when no money was…

Q: decrease the selling price per unit by half. Assuming tha ffect on profit? e information in the…

A: Profit would remain unchanged.

Q: Below is the information on a project that you are evaluating for deciding on its worthiness as an…

A: The question is related sensitivity Anaysis. The details are given

Q: Which of the following is true regarding LIFO and FIFO? A) In a period of decreasing costs, LIFO…

A: First in first out is also written as FIFO and last in first out is also written as LIFO. These are…

Q: Which of the following statements is true? OA. When a large proportion of income is spent on a…

A: To find: which of the following statement is true

Q: The line that begins at the origin on a CVP graph represents     total expenses.     total fixed…

A: Since you have posted multiple questions , we will do the first one for you. If you want any…

Q: Which of the following is true regarding the contribution margin ratio of a company that produces…

A: Contribution margin ratio =Contribution per unitSales price per unit Contribution per unit = Sales…

Q: For CVP analysis calculations, which of the following statements is correct? O A. In target profit…

A: The break-even sales are calculated as the fixed costs divided by the contribution margin ratio. The…

Q: QUESTION 2 REQUIRED Study the information provided below and answer the following questions…

A: Working For   2.4 Break even if Selling Price Reduced by 40 and Sales commission is 10%   1. Break…

Q: The equation for Gross Profit is "Gross Profit = Revenues - Cost of Goods." Which of the following…

A: Gross income is direct income of a business generated from direct revenues of the company. It is an…

Q: CVP analysis makes all of the following assumptions except     a change in volume is the only…

A: In order for a CVP analysis to be accurate, certain assumptions must be met. These assumptions are:…

Q: Which of the following is true regarding the contribution margin ratio of a company that produces…

A: Contribution margin is one of the important terms under the Cost Volume Profit analysis.Contribution…

Q: Steadily increasing cost of goods sold as a percentage of net revenues is an indication ofa.…

A: Answer: a. decreasing earnings quality.

Q: Which of the following is NOT an assumption of cost-volume-profit analysis?   Question 10…

A: The question is based on the concept of Cost Accounting.

Q: 1.  Which of the following assumptions is false in a cost-volume-profit analysis? Total sales and…

A: Since you have asked multiple questions, we will solve the first question for you. If you want any…

Q: A company's break-even point will  not be changed by:

A: Break-even point i Break-even point is a level of activity where no profit is gained and no loss…

Inventory Valuation

Before discussing the topic inventory valuation let’s discuss the meaning of inventory. In accounting, inventory is also known as stock. Inventory means all the finished goods, materials, merchandise that a business holds for the purpose of selling it in the market with the motive of earning profit.