BUSA
101 – Fundamentals of Acct. I
Chapter
6 – Inventory
Schmidt
Chapter
Objectives:
- Understand
concepts of counting: what is
included and what is not included in physical inventory counts
- Understand
the importance of inventory costing and how errors affect all financial
statements
- Understand
and be able to calculate inventory and COGS using major cost assumptions
for BOTH a perpetual and periodic inventory system
- Understand
when inventory should be valued at an amount “other than cost”
- Be
able to estimate inventory using two common methods - gross profit and
retail method
- Be
familiar with the presentation on the balance sheet and with the
disclosures required