Hanlin Company Uses the Periodic Inventory System to Account for Inventories

question 133

Essay

Hanlin Company uses the periodic inventory system to account for inventories. Information related to Hanlin Company's inventory at January 31 is given below: Instructions
1. Show computations to value the ending inventory using the FIFO cost assumption if 600 units remain on hand at January 31.
2. Show computations to value the ending inventory using the weighted-average cost method if 600 units remain on hand at January 31.
3. Show computations to value the ending inventory using the LIFO cost assumption if 600 units remain on hand at January 31.

Recognize the importance of considering salvage values in the computation of payback periods.

Understand the preference rule for ranking projects using the profitability index.

Learn about the components included in the nominal cost of capital, including expected inflation.

Understand how the internal rate of return (IRR) functions as a decision criterion in investment projects.

---

Definitions:

Social Pressure

The influence exerted by the social environment on individuals, compelling them to change their behaviors, values, or beliefs to conform to societal norms.

Individual Preferences

The personal likes or dislikes of an individual, influencing their choices and behaviors.

Theory of Reasoned Action

A theory that predicts an individual's intention to engage in a behavior at a specific time and place, based on the attitude toward the behavior and subjective norms.

Predicting Behaviour

The process of forecasting individuals' actions based on factors such as past behavior, psychological tendencies, or situational variables.