Question

7. Which of the following is a method used to track stocks?

a) First In, First Out Method (FIFO)

b) Average Evnater Method

c) Continuous Inventory Method

d) Moving Inventory Method

8. The entity paid TL 1,000.- to the contracted lawyer to cover the fees and expenses of lawsuits. Which of the following accounts will be debited in the relevant accounting record?

     a) 196 Personnel Advances

b) 381 Expense Accruals

c) 770 General Administrative Expenses

d) 195 Business Advances

e) 100 Cash

Answer 1

7 )ANS : FROM GIVEN INFORMATION

ANS) FIFO( FIRST- IN -FIRST -OUT) is the best method used to track the stocks in portfolio

this system is popular with business that work with perishable stock..it aims to ensure that stock does not deteriote before use.As stock is identifiedd by when iti was received and moves onto the next stage of production before stock received at a later date.

AVERAGE INVENTORY METHOD: it is assumed that the cost of inventory is based on average cost of goods available for sale.

CONTINOUS INVENTORY METHOD: basically it is allows business to keep a real-time account of inventory on hand

MOVING INVENTORY METHOD: it is mainly used to re calculate after every inventory purchase

8) ANS: FROM GIVEN INFORMATON ON FEES AND EXPENSES ARE ACCOUNTED TO WHICH RECORD:

IN ABOVE, entity paid some cotractual expenses to cover fees lawsuit is an contingent liability because of their outcomes are uncertain in regard to contracted lawyer...

in above inforamation, expenses and fees are treated under  381 accrual expenses are dibted in record, as accrual basis are recored as on date that will happen in future period of time.