The Lower of cost or market is not covered. Estimate ending inventory using the gross profit method. Describe the meaning and use of the Inventory Turnover Ratio. Describe how the perpetual inventory system works. Chapter 7 Cash and Receivables 1.
Cash Explain the various forms of cash shown on the balance sheet.
Investments Understand how to account for investments of idle cash. Prepare Journal Entries to record the purchase of short-term investments. Prepare Journal Entries to record the receipt of dividend income. Prepare the adjusting entries to record the decline in value of short temporary investments. Prepare the adjusting entries to record the increase in value in short-term investments.