Question

Tinker Bell Company has the following: Units Unit Cost Inventory, Jan. 1 8,000 $11 Purchase, June 19 13,000 12 Purchase, Nov. 8 5,000 13 If Tinker Bell has 9,000 units on hand on December 31, the cost of the ending inventory under LIFO is a. $113,000. b. $100,000. c. $108,000. d. $99,000. a. . b. . c. . d. . 3.33333 points Save Answer QUESTION 2 Which of the following should not be included in the physical inventory of a company? a. Goods held on consignment from another company b. Goods shipped on consignment to another company c. Goods in transit from another company shipped FOB shipping point d. None of the answer choices are correct

Answer 1

Answer:

Question 1

b. $100,000

Question 2

(a) Goods held on consignment from another company.

Explanation:

Question 1

Calculation to determine what the cost of the ending inventory under LIFO is

Using this formula

Cost of the ending inventory =(Inventory, Jan. 1 Units*Cost )+[(Dec 31 Units on hand- Inventory, Jan. 1 Units)*Purchase, June 19 Cost ]

Let plug in the formula

Cost of the ending inventory =(8,000 * $11) + (1,000 *$12)

Cost of the ending inventory =$88,000+$12,000

Cost of the ending inventory =$100,000

Therefore the cost of the ending inventory under LIFO is $100,000

Question 2

GOODS HELD ON CONSIGNMENT FROM ANOTHER COMPANY should NOT be included in the PHYSICAL INVENTORY of a company but rather be included in the inventory of the sender of the goods which is the CONSIGNOR.