Which Method Might Allow a Company to Make Significant Inventory

question 53

Multiple Choice

Which method might allow a company to make significant inventory purchases at year end for the purpose of manipulating income?

• A) FIFO
• B) Weighted Average Cost
• C) LIFO
• D) Specific Identification

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Definitions:

Blank Indorsement

A type of endorsement on a negotiable instrument where the endorser does not specify an endorsee, making it payable to the bearer.

Restrictive Indorsement

A limit placed on the use of a check or other negotiable instrument which specifies the conditions under which it can be transferred or paid out.

Bearer Paper

A negotiable instrument or security not registered in the owner's name and thus payable to the holder or presenter.

Specially Indorsed

A check or negotiable instrument that has been endorsed (signed on the back) and specifies the person to whom or to whose order the instrument is payable.