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Exam 6: Receivables and Inventories

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Question 21

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The amount of the promissory note plus the interest earned on the due date is called the:

A) market value.
B) maturity value.
C) face value.
D) discounted value.

E) B) and C)
F) C) and D)

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Question 22

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If the cost of an item of inventory is $70,the current replacement cost is $65,and the sales price is $85,the amount included in inventory according to the lower-of-cost-or-market method is:

A) $65.
B) $70.
C) $85.
D) $160.

E) B) and C)
F) B) and D)

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Question 23

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Use the following data to calculate cost of merchandise sold under FIFO method.

On the basis of the following data related to current assets for Mission Co.at December 2016,prepare a partial balance sheet in good form.

Under which method of inventory costing is the ending inventory assumed to be composed of the most recent costs?

The direct write-off method records uncollectible accounts expense in the year the specific account receivable is determined to be uncollectible.

If net sales is $550,000,beginning inventory is $110,000,and ending inventory is $125,000,how much would be the accounts receivables turnover?

The following units are available for sale during the year: Determine ending inventory cost by (a) FIFO method, (b) LIFO method, and (c) average cost method.

Classify the following as either Current Assets (CA),Investments (I),or both (CA and I).

A 90-day,10% note for $10,000 dated March 15 is received from a customer on account.The face value of the note is:

The due date of a 60-day note dated July 12 is:

During a period of consistently rising prices,the method of inventory costing that will result in reporting the greatest cost of merchandise sold is:

When merchandise sold is assumed to be in the order in which the expenditures were made,the inventory costing method is called:

During inflationary periods,the use of the LIFO method of costing inventory will result in a lesser amount of net income than would result from the use of the average method of inventory costing.

The party promising to pay a note at maturity is the payee.

Other than accounts receivable and notes receivable,name other receivables that might be included on the balance sheet.

A note receivable due in 18 months is listed on the balance sheet under the caption:

Determine the due date and amount of interest due at maturity on the following notes (Assume 360 days in a year):

"Market," as used in the phrase "lower of cost or market" for valuing inventory,refers to the price at which the inventory is being offered for sale by its owner.

The maturity value of a 12%,60-day note for $1,000 is $1,020.(Assume 360 days in a year)