Inventory Management and Cost of Goods Sold: A Comprehensive Guide for Auditors
CHAPTER 12
Inventories and Cost
of Goods Sold
Review Questions
12–1Substantiation of the figure for inventories is an especially challenging task because of the variety of acceptable methods of valuation.In addition, the variety of materials found in inventories calls for considerable experience and skill to do an efficient job of identifying and test-counting goods on hand.The possibilities of obsolescence and of excessive stocks also create problems.Finally, the relatively large size of inventories
Read MoreStrategic Management: A Comprehensive Guide to Value Chains, Competitive Strategies, and Corporate Parenting
Value Chain and Center of Gravity
A value chain is a sequence of value-creating activities that transform raw materials into finished products or services. The center of gravity is the most critical part of the chain, where the company’s expertise and capabilities lie.
Sustainability of Distinctive Competency
Two characteristics determine the sustainability of a firm’s distinctive competency: durability and imitability. Durability refers to the rate at which the underlying resources and capabilities
Read MoreSupplier Evaluation and Negotiation: A Comprehensive Guide
Evaluation of Tenders
To purchase a product or a new product, the steps to evaluate and compare the information received are:
- Preset 1, the bids received. Eliminated by the provider that fits our main conditions.
- Develop a comparative table of offerings. It should reflect information on price, quality, payment, delivery time, and all the conditions offered by each of the shortlisted suppliers.
- Complete one form for each provider. The form should contain information identifying the company that can supply
Understanding the Financial Markets: A Comprehensive Guide
1. High Color Detergent is issuing new shares of stock which will trade on NASDAQ. If Sue purchases 300 of these shares, the trade will occur in which one of the following markets? Primary
2. Wilson just placed an order with his broker to purchase 500 of the outstanding shares of GE. This purchase will occur in which one of the following markets? Secondary
3. . Hi-Tek Shoes is a private firm that has decided to issue shares of stock to the general public. This stock issue will be referred to as a(
Read MoreThe Ultimate Guide to Purchase Requisitions, Quotes, and Invoices
1. What is a Purchase Requisition?
A purchase requisition is a written request sent to the purchasing department to inform them about a need for materials or supplies. Purchase requisitions are usually printed in a format specified by each company.
2. What Data Should a Purchase Requisition Include?
- Requisition Number
- Name of Requesting Person or Department
- Number of Items Requested
- ID Number
- Catalog Item Description
- Unit Price
- Total Price
- Cost of Shipping, Handling, Insurance, and Related Costs
- Total Cost
Monopoly Power, Price Rigidity, and Economies of Scale in Microeconomics
Price Rigidity in Non-Collusive Oligopolies
There are many ways to explain why non-collusive oligopoly is characterized by price rigidity. One explanation is the use of game theory. This theory considers the optimum strategy that a firm could undertake in light of different situations between firms. It is useful when there are few firms in the market; otherwise, it is impossible to accurately predict outcomes. In general terms, it is used when firms that have the same costs, identical products, and
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