The document discusses the timing of inventory counts from an auditor's perspective. Taking inventory just before or at year-end is best to get an accurate count for financial reporting. It also discusses revenue recognition for sales shipped FOB destination. The buyer must remit the full selling price plus any freight costs to the seller
The document discusses the timing of inventory counts from an auditor's perspective. Taking inventory just before or at year-end is best to get an accurate count for financial reporting. It also discusses revenue recognition for sales shipped FOB destination. The buyer must remit the full selling price plus any freight costs to the seller
The document discusses the timing of inventory counts from an auditor's perspective. Taking inventory just before or at year-end is best to get an accurate count for financial reporting. It also discusses revenue recognition for sales shipped FOB destination. The buyer must remit the full selling price plus any freight costs to the seller
The document discusses the timing of inventory counts from an auditor's perspective. Taking inventory just before or at year-end is best to get an accurate count for financial reporting. It also discusses revenue recognition for sales shipped FOB destination. The buyer must remit the full selling price plus any freight costs to the seller
An inventory method considered as the benchmark or preferable treatment in
accounting for the cost of inventories FIFO, LIFO, Weighted Average LIFO, Weighted Average FIFO, Weighted Average Weighted average FIFO FIFO, LIFO LIFO
2. The following costs are excluded from the cost of inventories and recognized as expenses in the period in which they are incurred, except: Import taxes None of the choices Selling costs Storage costs Administrative ov
3. An auditor has accounted for a sequence of inventory tags and is now going to trace information on a representative number of tags to the physical inventory sheets. The purpose of this procedure is to obtain assurance that: All inventory represented by an inventory tag is bona fide Inventory sheets do not include untagged inventory items The final inventory is valued at cost All inventory represented by an inventory tag is listed on the inventory sheets
4. Which of the following timing of inventory count is the best based on the auditor’s point of view? All of the following are equal Inventory count just before year-end Inventory count just after year-end Inventory count at year-end
5. When a seller ships its inventory to its customer at year-end and the terms are FOB destination freight collect, then the buyer must remit to the seller The selling price of the inventory only The selling price of the inventory plus freight costs The freight costs only The selling price of the inventory less freight costs
6. All of the following are part of an entity’s inventory at year-end, except
Inventory sold and still in-transit at year-end, FOB Destination Inventory held for window display in a company’s store Goods out on consignment Finished Goods, made to order by a customer 7. During your audit of a certain company, you have determined that they maintain subsidiary accounts for its Inventory, particularly Raw Materials, Work in Process and Finished Goods. The Finished Goods are expected to be sold at above its cost. What should be the proper valuation of the related Raw materials? Historical Cost of Raw Materials Lower of Cost or Net Realizable Value Replacement Cost Net Realizable Value
USE THE FOLLOWING FOR NOS. 8-10
8. How much cash was disbursed during 2020 for purchases of merchandise? P 744,300 P 747,000 P 832,500 P 879,300
9. How much was the cost of goods sold in 2019?
P 693,000 P 828,000 P 792,000 P 742,500
10. How much was the cash collected during 2020 resulting from sales in 2019 and 2020? P 1,079,600 P 1,079,400 P 1,085,400 P 1,009,800 USE THE FOLLOWING FOR 11-13
11. Raw materials used for the period are
P 50,000 P 90,000 P 70,000 P 80,000
12. How much was the cost of goods manufactured and completed as of May 1, 2019? P 190,000 P 180,000 P 120,000 P 182,500
13. The work in process inventory destroyed as computed by the adjuster would be: P 173,500 P 131,500 P 113,500 P 121,500 14. How much is the total cost of purchases?
P1,840,000 P1,800,000 P1,675,000 P1,600,000 USE THE FOLLOWING TO ANSWER 15-16 15. What is the adjusted balance of inventory as of December 31, 2018? 445,000 435,000 455,000 425,000
16. What is the correct amount of net purchases for 2018?
2,445,500 2,412,500 2,432,500 2,455,500
USE THE FOLLOWING FOR 17-18
17. What is the company’s gross profit rate beginning January 1, 2018? 21% 24% 20% 17%
18. How much is the inventory fire loss?
254,000 183,640 146,920 189,400 Use the following to answer 1 and 2
1. How much is the correct Inventory as of December 31? * 296,000
2. How much is the correct Accounts Payable as of December 31? * 208,000 3. How much is the adjusted cost of goods sold? * 4,811,500 4. Compute for the inventory fire loss *
5. Compute for the overstatement or understatement of cost of Sales for 2015. *
(3316) 6. If the company is using a gross profit rate based on cost of 40%, what is the estimated ending inventory as of the end of the interim period? *
7. How much is the cost of goods sold for 2019? *
8. The company reported inventories at P400,000 as a result of its physical count on December 31, 2018, what is the amount of estimated ending inventory shortage/overage as a result of your audit procedures using the FIFO RETAIL APPROACH? (round off cost% to nearest whole number, eg: xx%) *
