inventory : Under the LIFO method , what amount should Metro report as inventory at January 31 , 2004 ? Question 6 Anders Co . uses the moving-average method to determine the cost of its inventory . During January 2005 , Anders recorded the following information pertaining to its inventory : What amount of inventory should Anders report in its January 31 , 2005 , balance sheet ? Question 7 When the double extension approach to the dollar-value LIFO inventory method is used , the inventory layer added in the current year is multiplied by an index number . Which of the following correctly states how components are used in the calculation of this index number ? Question 8 Fireworks , Inc . had an explosion in its plant that destroyed most of its inventory . Its records show that beginning inventory was $ 40,000 . Fireworks made purchases of $ 480,000 and sales of $ 620,000 during the year . Its normal gross profit percentage is 25 %. It can sell some of its damaged inventory for $ 5,000 . The insurance company will reimburse Fireworks for 70 % of its loss . What amount should Fireworks report as loss from the explosion ? Question 9 When the dollar-value LIFO ( DV LIFO ) retail method is used , what is the first step in the calculation ? Question 10 Smith Co . has a checking account at Small Bank and an interestbearing savings account at Big Bank . On December 31 , year 1 , the bank reconciliations for Smith are as follows : What amount should be classified as cash on Smith ' s balance sheet at December 31 , year 1 ? Question 11 At the end of the current year ( calendar-fiscal year ), a creditor firm ' s 6 % note receivable balance is $ 10,000 . Two years remain in the note term . Interest is due each December 31 . The debtor ' s financial