Why do better decisions regarding the purchasing and managing of goods for sale frequently cause dramatic percentage increases in net income?

Q: Contrast the effects that LIFO vs. FIFO would have on ending inventory, net income and cash flow in…

A: Under LIFO(Last in first out) method: Inventory is valued at using the costs incurred for the…

Q: If inventory is being valued at cost and the price level is steadily rising, which of the three…

A: Inventory can be defined as a form of asset which is held by a business firm for resale purposes.…

Q: What is the formulae to find New sales level?

A: Break-Even point (sales dollars) = Fixed Costs ÷ Contribution Margin.        or

Q: Explain whether the following situations, taken independently, would be favorable or unfavorable: (…

A: Favorable is the condition that is positive for a business. This implies that the variance or the…

Q: When the return on sales (also known as net profit margin) is negative, what does this mean? Group…

A: Net profit margin (NPM) or return on sales measures the profitability of the company. Higher the…

Q: Why would reclassifying period costs as product costs increase this period’s reported earnings?

A:

Q: Assume a company receives an actual return of goods. Which of the following needs to happen? Sales…

A: The return of goods is the amount of goods that were sold to customers but were returned to…

Q: In times of decreasing prices, LIFO will result in ____ costs of goods sold and _____ ending…

A: FIFO: FIFO stands for First-In, First-Out.  In this method inventory purchased first will be sell…

Q: In calculating inventory turnover, why is cost of goods sold used as the numerator? As the inventory…

A: Inventory turnover ratio:Inventory turnover ratio is used to determine the number of times inventory…

Q: A decision about one product is said to have ________ effects when a change in the sales of one…

A: A decision about one product is said to have ________ effects when a change in the sales of one…

Q: In a period of rising prices, FIFO will result in O lower net income than LIFO. lower net purchases…

A: Inventory valuation is the process by which the inventory of the entity is valued. It can be done…

Q: gross profit margin (gross profit/sales) is an important determinant of NOPAT. identify two factors…

A: Gross profit: Gross profit is a profit for a company arrived after deducting cost associated with…

Q: Which of the following statements about the quality of earnings ratio is true? Multiple Choice…

A: Lets understand the basics. Quality of earning ratio indicates the cashflow from operating activity…

Q: By having different inventory methods that result in different costs of goods sold and gross profit,…

A: Inventory refers to the stock of work-in-process, raw material & finished goods in the company.…

Q: Name the accounting principle that requires inventories to be reported at sales price less…

A: Conservatism Principle This is the concept that you should record expenses and liabilities as soon…

Q: Identify which of the statements below are true (T) or false (F). Lean businesses aim to: Reduce…

A: Lean businesses aim to: Reduce inventory levels--true

Q: “Managers should always buy inventory in quantities that result in the lowest purchase cost per…

A: Inventory:  Inventory refers to the raw materials, work-in process, and the finished goods products…

Q: Sales less sales discounts, less sales returns and allowances equals: Multiple Choice Net purchases.…

A: The net sales are calculated as the amount to be received from customers.

Q: What is the gross profit declined due to increase in cost in the amount?

A: Gross profit refers to the profit calculated after considering the costs associated with the…

Q: which one of the following will tend to increase the length of the credit period? Decrease in…

A: The length of credit period is a time duration provided to its consumer to pay back the amount of…

Q: Explain the calculation procedures for and significance of return on sales.

A: The return on sales (ROS) ratio is a statistic for evaluating a business's operational efficiency.…

Q: An increase (decrease) in cost of sales due to volume of *

A: Cost of Sales Cost of sales which is described as the cost which are incurred at the time of sales…

Q: Which inventory method will result in lower net income in a period of rising prices? Which inventory…

A: First-in-First-Out (FIFO): In this method, items purchased initially are sold first. So, the value…

Q: Which of the following may not result to the amount of cost of sales? a.Net purchases less net…

A: Solution- COGS can be calculated in three steps that culminate in one formula.   Or, to put it…

Q: The increase (decrease) in gross profit due to change in overall quantity sold is:

A: As the student has asked specific question so we are answering that question only.

Q: In a period of rising prices,a. cost of goods sold under LIFO will be less than under FIFO.b. gross…

A:

Q: How can accounting keep up with the rising sales return rates, especially when it comes to inventory…

A: Management of inventories: Inventory management may be characterized as a system for measuring and…

Q: s it always higher in cost of goods sold in Weighted average compared to FIFO?

A: Inventory and cost of goods sold can be value on the basis of FIFO or LIFO basis. In LIFO , cost of…

Q: Why is reduce inventory cost is an advantage of inventory outsourcing?

A: Inventory is defined as the goods as well as materials, which has the business holding for an…

Q: If inventory is being valued at cost and the price level is steadily rising, which of the three…

A: Introduction:

Q: Steadily increasing cost of goods sold as a percentage of net revenues is an indication ofa.…

A: Answer: a. decreasing earnings quality.

Q: Which of the following will increase the gross profit of the merchandising business? Increase in…

A: Gross profit = Sales - cost of goods sold where, Cost of goods sold = Purchase cost of goods used +…

Q: During periods of rising costs, which inventory costing method produces the highest gross profit?

A: Inventory cost flow assumptions: These are the methods used by the companies to compute the cost…

Q: What is an aging schedule? What can be learned from it? How is itaffected by sales fluctuations?

A: Aging schedule is a statement which shows the time taken to recover their receivable and for…

Q: How should accounting be able to catch up with the high sales return rates, particularly on…

A: Inventory management: Inventory management can be defined as a system to measure and record the…

Q: a. Why is a high inventory turnover considered to be a positive indicator?b. Is it possible to have…

A: a.Inventory turnover shows the company’s ability to sell its inventory, it is shown in terms of…

Q: Which of the following statements is true with regard to the gross profit ratio? An increase in…

A: Gross profit is an excess amount of revenue over its cost of goods sold.it measures profitability…

Q: When inventory costs rise and inventory quantities are not decreasing, what does the LIFO produces?

A: Last-in-First-Out (LIFO): In this method, items purchased recently are sold first. So, the value of…

Q: Gross profit variance analysis can be used to study the effect of:  a. Changes in volume of goods…

A: Gross profit variance analysis is referred as the measurement tool used to measure the capability of…

Q: Are all the relationships below correct? Sales is equal to Production (no change in inventory) No…

A: "Since you have asked multiple sub part question we will solve the first three sub part question for…

Q: Gross profit variance analysis can be used to study the effect of:    a. Changes in cost of goods…

A: Gross profit is the gross income/revenue left after deducting the cost of goods sold from the net…

Q: 2. Shepherd Cycles does not expect prices to change dramatically and wants to use a method that…

A: An inventory valuation allows a business to assign a monetary value to items in its inventory.…