Gretel,an Inventor,has Tools in Her Workshop,including Hammers,a Table Saw,and Drills

question 22

Multiple Choice

Gretel,an inventor,has tools in her workshop,including hammers,a table saw,and drills.She has a patent on her most recent invention,a kitchen gas grill.She licenses the patent to Home Appliances,Inc.,a company in which she owns stock.Her tangible personal property includes 

• A) ​the workshop tools. 
• B) ​the Home Appliances stock. 
• C) ​the patent on the gas grill and license to Home Appliances. 
• D) ​all of the choices.

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Definitions:

FIFO

An accounting method for valuing the cost of goods sold that assumes the earliest items purchased are the first to be sold.

Weighted Average Method

An inventory costing method that assigns a cost to inventory items based on the average cost of all similar items in inventory, weighted by the quantities purchased at different prices.

LIFO

An inventory valuation method, "Last In, First Out," where the most recently produced or purchased items are recorded as sold first.

Periodic Inventory System

An inventory system that updates inventory balances and cost of goods sold at the end of an accounting period based on a physical count.