Garrison Company uses the retail method of inventory costing. It started the year with an inventory that had aretail cost of 45,000 . During the year, Garrison purchased an inventory with a retail sales value of300,000 . After performing a physical inventory, Garrison calculated the inventory at retail to be 80,000 . Themark up is 100 of cost. Determine the ending inventory at its estimated cost.
a. 160,000
b. 80,000
c. 40,000
d. 45,000
(
Q. 2) Maxine, Inc. bought a machine on January 1, 2012 for 48,000. The machine is expected to last for 8 years, after which it will be worthless. How much depreciation expense will Maxine show on its income statement for the year ended December 31, 2012?
A) 48,000
B) 8,000
C) 6,000
D) 0. Depreciation expense does not appear on the income statement.
(
Q. 3) Quality assurance function:
a. modifies and adapts application software
b. conducts reviews to determine adherence to IT standards
c. analyzes existing applications and proposes solutions
d. supervises applications systems development
(
Q. 4) Good business planning involves the identification of risks such as operating risks and financial risks.
Indicate whether the statement is true or false
(
Q. 5) Any Federal Reserve Bank or other authorized commercial bank may issue an Employer Identification Number (EIN).
a. True
b. False
Indicate whether the statement is true or false
(
Q. 6) All of the following are reasons to use an estimated method of costing inventory except
a. Perpetual inventory records are not maintained.
b. Purchase records are not maintained.
c. A disaster has destroyed the inventory records and the inventory.
d. Interim financial statements are required but physical inventory is only taken at the end of the financialaccounting period.
Quick Reply
