Question Details

What amount should Lawson report as inventories in its statement 



1.	Morgan Manufacturing Company has the following account balances at year end:
Office supplies	$  4,000
Raw materials	27,000
Work-in-process	59,000
Finished goods	72,000
Prepaid insurance	6,000
What amount should Morgan report as inventories in its statement of financial position?
a.	$72,000. 
b.	$76,000.
c.	$158,000.
d.	$162,000.

2.	Lawson Manufacturing Company has the following account balances at year end:
Office supplies	$  4,000
Raw materials	27,000
Work-in-process	59,000
Finished goods	92,000
Prepaid insurance	6,000
What amount should Lawson report as inventories in its statement of financial position?
a.	$92,000. 
b.	$96,000.
c.	$178,000.
d.	$182,000.

	3.	Elkins Corporation uses the perpetual inventory method. On March 1, it purchased $10,000 of inventory, terms 2/10, n/30. On March 3, Elkins returned goods that cost $1,000. On March 9, Elkins paid the supplier. On March 9, Elkins should credit
a.	purchase discounts for $200.
b.	inventory for $200.
c.	purchase discounts for $180.
d.	inventory for $180.

	4.	Malone Corporation uses the perpetual inventory method. On March 1, it purchased $30,000 of inventory, terms 2/10, n/30. On March 3, Malone returned goods that cost $3,000. On March 9, Malone paid the supplier. On March 9, Malone should credit
a.	purchase discounts for $600.
b.	inventory for $600.
c.	purchase discounts for $540.
d.	inventory for $540.
	5.	Bell Inc. took a physical inventory at the end of the year and determined that $650,000 of goods were on hand. In addition, Bell, Inc. determined that $50,000 of goods that were in transit that were shipped f.o.b. shipping were actually received two days after the inventory count and that the company had $75,000 of goods out on consignment. What amount should Bell report as inventory at the end of the year?
a.	$650,000.
b.	$700,000.
c.	$725,000.
d.	$775,000.

	6.	Bell Inc. took a physical inventory at the end of the year and determined that $475,000 of goods were on hand. In addition, the following items were not included in the physical count. Bell, Inc. determined that $60,000 of goods were in transit that were shipped f.o.b. destination (goods were actually received by the company three days after the inventory count).The company sold $25,000 worth of inventory f.o.b. destination. What amount should Bell report as inventory at the end of the year?
a.	$475,000.
b.	$535,000.
c.	$500,000.
d.	$560,000.

	7.	Risers Inc. reported total assets of $1,200,000 and net income of $135,000 for the current year. Risers determined that inventory was overstated by $10,000 at the beginning of the year (this was not corrected). What is the corrected amount for total assets and net income for the year?
a.	$1,200,000 and $135,000.
b.	$1,200,000 and $145,000.
c.	$1,190,000 and $125,000.
d.	$1,210,000 and $145,000.



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