1) What are the major differences between the perpetual and the periodic inventory systems?
2) What does it mean if goods are shipped FOB Shipping Point? What does it mean if goods are shipped FOB Destination? What are Consigned Goods?
3) Does a company have to physically have inventory in its warehouse or on the shelf to count it on the balance sheet at the end of an accounting period? Explain.
4) What are some examples of inventory errors?
5) What are the differences been the cost flow and the physical flow of inventory?
6) What are the major financial statement effects of using the FIFO inventory method in accounting for Cost of Goods Sold and Ending Inventory? What are the major financial statement effects of using the LIFO inventory method in accounting for Cost of Goods Sold and Ending Inventory
7) What are some of the costs that can be “capitalized” into the cost of Land on the balance sheet?
8) What are some of the costs that can be capitalized into the cost of Building on the balance sheet?
9) What are excavation costs? How are they accounted for in the construction process?
10) How are interest costs incurred during construction accounted for (assuming the interest is related to a loan taken out for construction purposes)?
11) Assume land is purchased and there is a building on the property. If the building is torn down prior to constructing a another building, how is removal cost of the old building accounted for? Explain.
