1. A company just starting business made the following inventory transactions in August:
| Purchase on August 1 | 300 units | $1,560 |
| Sale on August 8 | 200 units | 3,400 |
| Purchase on August 12 | 400 units | 1,340 |
| Sale on August 24 | 350 units | 5,950 |
Using the LIFO inventory method, how much is cost of goods sold for August using a perpetual inventory system?
2. A company just starting business made the following purchases in August:
| August 1 | 300 units | $1,560 |
| August 12 | 400 units | 2,340 |
| August 24 | 400 units | 2,520 |
| August 30 | 300 units | 1,980 |
| 1,400 units | $8,400 |
A physical count of the inventory on August 31 reveals that there are 500 units on hand. Using the FIFO inventory method in a perpetual inventory system, how much is the value of the ending inventory on August 31?
3. Which statement is true in a perpetual inventory system?
| a | Average costs are based entirely on unit-cost simple averages.
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| b | A new average is computed under the average cost method after each sale.
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| c | LIFO cost of goods sold will be the same as in a periodic inventory system.
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| d | FIFO cost of goods sold will be the same as in a periodic inventory system.
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4. Inventory turnover is calculated by dividing cost of goods sold by
Solution: ACC 290-A company just starting business made the following