Chapter 8 - Valuation of inventories: A cost-basis approach. After studying this chapter, you should be able to: Identify major classifications of inventory, distinguish between perpetual and periodic inventory systems, identify the effects of inventory errors on the financial statements. | Prepared by Coby Harmon University of California, Santa Barbara Intermediate Accounting Intermediate Accounting Prepared by Coby Harmon University of California, Santa Barbara Westmont College INTERMEDIATE ACCOUNTING F I F T E E N T H E D I T I O N Prepared by Coby Harmon University of California, Santa Barbara Westmont College kieso weygandt warfield team for success PREVIEW OF CHAPTER Intermediate Accounting 15th Edition Kieso Weygandt Warfield 8 Explain the significance and use of a LIFO reserve. Understand the effect of LIFO liquidations. Explain the dollar-value LIFO method. Identify the major advantages and disadvantages of LIFO. Understand why companies select given inventory methods. After studying this chapter, you should be able to: Valuation of Inventories: A Cost-Basis Approach 8 LEARNING OBJECTIVES Identify major classifications of inventory. Distinguish between perpetual and periodic inventory systems. Determine the goods included in inventory and the effects of inventory errors on the financial statements. Understand the items to include as inventory cost. Describe and compare the cost flow assumptions used to account for inventories. Inventories are asset: items held for sale in the ordinary course of business, or goods to be used in the production of goods to be sold. LO 1 Identify major classifications of inventory. Merchandiser Manufacturer Businesses with Inventory or Classification Inventory Issues One inventory account. Purchase merchandise in a form ready for sale. LO 1 Identify major classifications of inventory. Classification Inventory Issues Illustration 8-1 Illustration 8-1 LO 1 Identify major classifications of inventory. Inventory Issues Three accounts Raw Materials Work in Process Finished Goods Classification Illustration 8-2 LO 1 Inventory Issues Classification Explain the significance and use of a LIFO reserve. Understand the effect of LIFO liquidations. Explain the dollar-value LIFO method. Identify the major advantages and . | Prepared by Coby Harmon University of California, Santa Barbara Intermediate Accounting Intermediate Accounting Prepared by Coby Harmon University of California, Santa Barbara Westmont College INTERMEDIATE ACCOUNTING F I F T E E N T H E D I T I O N Prepared by Coby Harmon University of California, Santa Barbara Westmont College kieso weygandt warfield team for success PREVIEW OF CHAPTER Intermediate Accounting 15th Edition Kieso Weygandt Warfield 8 Explain the significance and use of a LIFO reserve. Understand the effect of LIFO liquidations. Explain the dollar-value LIFO method. Identify the major advantages and disadvantages of LIFO. Understand why companies select given inventory methods. After studying this chapter, you should be able to: Valuation of Inventories: A Cost-Basis Approach 8 LEARNING OBJECTIVES Identify major classifications of inventory. Distinguish between perpetual and periodic inventory systems. Determine the goods included in inventory and the effects of .
