Question Details

Quigley Company's records indicate the following information 




1.	Under the LCNRV approach, the net realizable value is defined as
a.	FIFO cost.
b.	LIFO cost.
c.	the net amount that a company expects to realize from a sale.
d.	selling price.

	2.	Euler Company made an inventory count on December 31, 2011. During the count, one of the clerks made the error of counting an inventory item twice. For the statement of financial position at December 31, 2011, the effects of this error are
	Assets	Liabilities	Equity
a.	overstated	understated	overstated
b.	understated	no effect	understated
c.	overstated	no effect	overstated
d.	overstated	overstated	understated

	3.	The inventory turnover ratio is computed by dividing cost of goods sold by
a.	beginning inventory.
b.	ending inventory.
c.	average inventory.
d.	365 days.

4.	Quigley Company's records indicate the following information for the year:
Merchandise inventory, 1/1	₤   550,000
Purchases	2,250,000
Net Sales	3,000,000
On December 31, a physical inventory determined that ending inventory of ₤600,000 was in the warehouse. Quigley's gross profit on sales has remained constant at 30%. Quigley suspects some of the inventory may have been taken by some new employees. At December 31, what is the estimated cost of missing inventory?
a.	₤100,000
b.	₤200,000
c.	₤300,000
d.	₤700,000





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