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addition, merchandise equaling 15% of sales will be exchanged
for merchandise of equal or greater value. What amount should
Fenn report for net sales in its income statement for the month of
December 2004?
Question 5
During January 2004, Metro Co., which maintains a perpetual
inventory system, recorded the following information pertaining
to its 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