Accounting Quiz

Under the LIFO method, the flow of goods through the accounting records will:

Under the average cost method, the flow of goods through the accounting records will:

Under the FIFO method, the flow of goods through the accounting records will:

___________ produces the lowest cost of goods sold and the highest gross profit when prices are increasing.

__________ produces the highest cost of goods sold and the lowest gross profit when prices are increasing.

A drawback to using ________________ when inventory costs are rising is that the company reports lower net income.

An error in the reported inventory will cause errors in all of the following EXCEPT the:

The inventory system that uses the merchandise inventory account as an active account is called the:

Goods such as milk, bread, and cheese would probably be costed using the:

Cost of goods sold is shown on the: