FA Quiz (Inventory)

What figure should be included in the financial statements for inventories at 30 June 20X3?

• $952,750

• $949,750

• $926,750

• $958,950

Which of the following costs may be included when arriving at the cost of finished goods inventory for inclusion in the financial statements of a manufacturing company?

• 1 and 5 only

• 2, 4 and 5 only

• 1, 3 and 5 only

• 1, 2, 3 and 4 only

What should the inventory value be according to IAS 2 Inventories after considering the above items?

• $281,200

• $282,800

• $329,200

• None of these

What is the value of the company’s closing inventory of engines at 30 April 20X3?

• $188,500

• $195,500

• $166,000

• None of these figures

Which of the following statements about the valuation of inventory are correct, according to IAS 2 Inventories?

• 1, 3 and 4 only

• 1 and 2 only

• 3 and 4 only

• None of the statements are correct

What figure should appear in the company’s financial statements at 31 October 20X3 for closing inventory, based on this information?

• $458,700

• $505,900

• $508,700

• $461,500

In preparing its financial statements for the current year, a company’s closing inventory was understated by $300,000.

What will be the effect of this error if it remains uncorrected?

• The current year's profit will be overstated and next year's profit will be understated.

• The current year's profit will be understated but there will be no effect on next year's profit.

• The current year's profit will be understated and next year's profit will be overstated.

• The current year's profit will be overstated but there will be no effect on next year's profit

What inventory value should be included in Mitex Co’s financial statements at 31 December 20X1?

• $525,400

• $527,600

• $529,200

• $535,200

Which of the following statements about IAS 2 Inventories is correct?

• Production overheads should be included in cost on the basis of a company's normal level of activity in the period.

• In arriving at the net realisable value of inventories, trade discounts and settlement discounts must be deducted.

• In arriving at the cost of inventories, FIFO, LIFO and weighted average cost formulas are acceptable.

• It is permitted to value finished goods inventories at materials plus labour cost only, without adding production overheads.

What is the correct inventory valuation for inclusion in the financial statements?

• $39,915

• $40,755

• $41,515

• $42,995