Questions from General Accounting

Q: Ruthie Stores has 20 toasters on hand at the balance sheet data

Ruthie Stores has 20 toasters on hand at the balance sheet data. Each cost $27.The current replacement cost is $30 per unit. Under the lower-of-cost-or-market basis of accounting for inventories, what...

Q: Mintz Company discovers in 2010 that it’s ending inventory at December 31

Mintz Company discovers in 2010 that it’s ending inventory at December 31, 2009, was $7,000 understated. What effect will this error have on (a) 2009 net income, (b) 2010 net income, and (c) the co...

Q: Willingham Company’s balance sheet shows Inventories $162,800. What

Willingham Company’s balance sheet shows Inventories $162,800. What additional disclosures should be made?

Q: Under what circumstances might inventory turnover be too high? That is

Under what circumstances might inventory turnover be too high? That is, what possible negative consequences might occur?

Q: An item must possess two characteristics to be classified as inventory by

An item must possess two characteristics to be classified as inventory by a merchandiser. What are these two characteristics?

Q: Your friend Tom Witt has been hired to help take the physical

Your friend Tom Witt has been hired to help take the physical inventory in Hawkeye Hardware Store. Explain to Tom Witt what this job will entail.

Q: Explain the difference between the terms FOB shipping point and FOB destination

Explain the difference between the terms FOB shipping point and FOB destination.

Q: David Shannon believes that the allocation of inventoriable costs should be based

David Shannon believes that the allocation of inventoriable costs should be based on the actual physical flow of the goods. Explain to David why this may be both impractical and inappropriate.

Q: T. J. Carlin has the following transactions during August of

T. J. Carlin has the following transactions during August of the current year. Indicate (a) the effect on the accounting equation and (b) the debit-credit analysis illustrated on pages 61–66 of the...

Q: What is a major advantage and a major disadvantage of the specific

What is a major advantage and a major disadvantage of the specific identification method of inventory costing?