After you have mastered the material in this chapter you will be able to:
Explain how different inventory cost flow methods (specific identification, FIFO, LIFO, and weighted average) affect financial statements. |
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Demonstrate the computational procedures for FIFO, LIFO, and weighted average. |
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Apply the lower-of-cost-or-market rule to inventory valuation. |
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Explain how fraud can be avoided through inventory control. |
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Use the gross margin method to estimate ending inventory. |
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Explain the importance of inventory turnover to a company's profitability. |
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Explain how accounting for investment securities differs when the securities are classified as held to maturity, trading, or available for sale. (Appendix) |