Reference no: EM131719072

Q1. Allgone Company's inventory was destroyed by fire. Its records show net sales of $90,000, beginning inventory of $20,000, net purchases of $75,000 and a gross margin rate of 30%. What is the estimated value of the ending inventory lost in the fire?

$75,000

$158,000

$68,000

None of the above

$32,000

Q2. The following information relates to the inventory of ABC Inc. who uses a perpetual inventory system:

DateTransaction# UnitsUnit cost/sales priceDecember 4Opening inventory300$15December 10Purchase inventory100$18December 15Sell inventory320$27December 20Purchase inventory150$20December 29Sell inventory100$30

What is the value of inventory on hand after the December 29 sale if FIFO is used?

$2,600

$2,200

$2,400

$3,900

$1,950

Q3. The following information has been extracted from the records of Due North Sales (DNS) Co.:

January 1 Beginning Inventory 550 units @ $26 each

January 9 Bought 1,000 units @ $28 each

January 15 Sold 1,200 units @ $40 each

January 25 Bought 800 units @ $30 each

If Due North Sales (DNS) uses the FIFO cost flow assumption, under a perpetual method, the ending inventory value at January 31st is:

$31,100

$32,750

$33,552

None of the other alternatives are correct

$33,800