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3 years ago

Which of the following is false regarding the FIFO inventory method?

Business

1 answer:

puteri [66]3 years ago

4 0

Answer: All of the other answer choices are true.

Explanation:

FIFO simply refers to “First-In, First-Out” and the method assumes that the oldest goods that are in the inventory of a company have been sold first and therefore, the costs that are paid for them will be used for the calculation.

The following are true regarding the FIFO method:

• FIFO under a perpetual inventory system results in the same cost of goods sold as FIFO under a periodic inventory system.

• A company can choose to account for the flow of inventory using the FIFO method even if this doesn’t match the actual flow of its inventory.

• Perishable goods often follow an actual physical flow that is consistent with the FIFO method assumptions.

Therefore, the correct option is D as all are true.

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A potato chip manufacturer purchases a potato farm. Which of the following regarding its strategy is true? The manufacturer has

astra-53 [7]

Question:

A potato chip manufacturer purchases a potato farm. Which of the following regarding its strategy is true?

A. The manufacturer has effectively used vertical integration to increase its bargaining position and reduce transaction costs.

B. The manufacturer has enhanced utilisation by allowing depreciation and other fixed costs to be spread over a larger unit volume.

C. The manufacturer has sacrificed quality by using a lower-cost input.

D. The manufacturer has efficiently capitalised on the experience and learning-curve effects within the company.

E. The manufacturer has effectively reduced its operating costs by outsourcing its activities.

Answer:

A. the Manufacturer has effectively used vertical integration to increase it's bargaining position and reduce transaction costs.

Explanation:

Vertical integration is a business strategy whereby a business acquires ownership or controls its suppliers, distributors, or retail locations to control its value or supply chain.

It may also be said that vertical integration has to do with the purchase of a part of all of the production or sales process that was previously outsourced, to have it done in-house.

An example of companies who have done this are:

1. Apple

2. Netflix

3. Comcast (Which acquired NBC)

Businesses can integrate by

purchasing their suppliers to reduce the costs of manufacturing or
controlling the distribution process that is, owning and controlling the warehousing and delivery of their products etc.

6 0

3 years ago

Read 2 more answers

How many years are required for an investment to double in value if it is appreciating at the rate of 9% compounded continuous

Vesna [10]

Answer:

time required is 7.70 years

Explanation:

given data

interest rate = 9%

solution

we know with the compounded continuously rate r and time t amount is

A(t) = A(o) $e^{rt}$ .................1

and we have given amount is double so

A(t) = 2 A(o)

so from equation 1 put the value and we get here

2 A(o) = A(o) $e^{rt}$

ln(2) = 0.09 t

solve it we get time

time t = 7.70 years

so time required is 7.70 years

7 0

3 years ago

What are some of the Miranda restrictions on questioning someone?

Veseljchak [2.6K]

"Miranda rights" require that police inform you that you have the right to remain silent, that anything you say can be against you in court, you have the right to have a lawyer present for questioning, and if you cannot afford a layer the court can appoint one for you.

3 0

3 years ago

Market segmentation involves aggregating prospective buyers into groups that __________ and will respond similarly to a marketin

Vlad1618 [11]

Have common needs is your answer .-.

6 0

3 years ago

JBS Inc. recently reported net income of $4,750 and depreciation of $885. How much was its net cash provided (used) by operation

stepan [7]

Answer:

net cash provided is $5,635

Explanation:

Amount ($)

Net Income 4,750

Depreciation 885

Change in inventory (200)

Change in accounts payable <u> 200 </u>

Net cash flows from Operation<u> 5,635</u>

The depreciation is a none cash item that was initially deducted to get the net income, hence it is added back in the cash flows statement.

An increase in inventory represents an outflow of cash hence the negative value. The increase in trade payable is an increase in a liability representing an inflow of cash hence it is positive.

7 0

3 years ago