1. A company just starting business made the following inventory transactions in August:

Purchase on August 1 300 units $1,560
Sale on August 8 200 units 3,400
Purchase on August 12 400 units 1,340
Sale on August 24 350 units 5,950

2. Using the LIFO inventory method, how much is cost of goods sold for August using a perpetual inventory system?

a $6,450
b $9,350
c $2,212.50
d $2,120

3. A company just starting business made the following purchases in August:

August 1 300 units $1,560
August 12 400 units 2,340
August 24 400 units 2,520
August 30 300 units 1,980
1,400 units $8,400

4. A physical count of the inventory on August 31 reveals that there are 500 units on hand. Using the FIFO inventory method in a perpetual inventory system, how much is the value of the ending inventory on August 31?

a $3,240
b $2,730
c $5,160
d $5,670

5. Which statement is true in a perpetual inventory system?

a Average costs are based entirely on unit-cost simple averages.
b A new average is computed under the average cost method after each sale.
c LIFO cost of goods sold will be the same as in a periodic inventory system.
d FIFO cost of goods sold will be the same as in a periodic inventory system.

6. Inventory turnover is calculated by dividing cost of goods sold by

a beginning inventory.
b 365 days.
c average inventory.
d ending inventory.