Florida Inc Uses a Periodic Inventory System with the Weighted

question 35

Multiple Choice

Florida Inc uses a periodic inventory system with the weighted average method of cost assignment.The following data are available: $\begin{array}{lllll}&&&& \text { Total }\\&\text { Date }&\text { Units }&\text { Unit Cost }&\text { Cost }\\\text { Beginning Inventory } & \text { Jan 1 } & 2000 & \$ 6 & \$ 12000 \\\text { Purchase } & \text { Mar 13 } & 4000 & \$ 7 & \$ 28000 \\\text { Purchase } & \text { June 20 } & 6000 & \$ 8 & \$ 48000 \\\text { Ending Inv entory } & \text { Dec } 31 & 1000 & &\end{array}$ The cost of the ending inventory to the nearest dollar is:

• A)$8333
• B)$8000
• C)$7300
• D)$6000

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Definitions:

Gross Profit Method

The Gross Profit Method estimates the cost of goods sold and the ending inventory value by applying the company's average gross profit percentage to its net sales.

Lower Of Cost

An accounting principle that values inventory at the lower of its historical cost or market value.

LIFO Inventory

Last-In, First-Out inventory method, where the most recently produced items are recorded as sold first.

Current Replacement Cost

The cost that would be incurred to replace an asset at the present time, considering the asset's current condition.