For the Current Month, the Beginning Inventory of Elipresse Inc

question 93

Multiple Choice

For the current month, the beginning inventory of Elipresse Inc. consisted of 3 units that cost CHF5,500 each. During the month, the company made two purchases: 4 units at CHF5,800 each and 1 units at CHF5,750. Elipresse sold 5 units during the month. If Elipresse uses specific identification and wishes to maximize net income, the units costs allocated to cost of goods sold will be:

• A) 5 units@CHF5,500.
• B) 4 units@CHF5,800 and 1 unit @CHF5,750
• C) 3 units@CHF5,500 and 1 unit @CHF5,800
• D) 3 units@CHF5,500, 1 unit @CHF5,750and 1 unit @CHF5,800

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Definitions:

Yield Spread

The difference between the yields on varying debt instruments, usually of different credit qualities or maturing at different times.

U.S. Treasuries

Short for United States Treasury securities, which are government debt instruments issued by the U.S. Department of the Treasury to finance government spending.

Brokers' Calls

Short-term loans for brokers to fund their clients' margin accounts, often callable on demand.

Stocks on Margin

Refers to buying stocks by borrowing a part of their purchase price from the brokerage firm.