UPT- INGLÉS TÉCNICO II – EPCC y F - FACEM

READING TEST 03 – UNIT II - INGLÉS TÉCNICO II

“INVENTORY VALUATION METHODS” – ON LINE
NAME. Jorge Luis Cueva Cauna CODE. 2017059488 DATE. – 08/06/2019

I. TRUE OR FALSE. - Read the article again and say whether these statements are TRUE OR FALSE . – (6)

1. Inventory is one large item after the assets.

FALSE
2. Inventory doesn’t include finished goods.
FALSE
3. In the objective of determination of income Gross profit is gotten by subtracting
TRUE
cost of goods sold from sales
4. The records in quantity and value inventory can be made in a pair of ways
TRUE
5. In the system of perpetual inventory the business needs to be pendent for stock
taking. TRUE

6. In FIFO , it’s based on historical cost.

TRUE

II. MATCH THE IDEAS AND DEFINITIONS.- Write the number (3)

1. INVENTORY a. how much money something might be sold for or the amount
4
of money decided on
2. PERPETUAL b. something that makes a situation more difficult
5
3. METHOD c. to deal with something

4. VALUATION d. a list of all the things that are in a place

1
5. DISADVANTAGE e. the fact of being acceptable or right for something
6
6. SUITABILITY f. the way in which one does something
3
7. g. continuing forever in the same way
2

III. PREPOSITIONS . - Complete these phrases using the prepositions in the box. (6)

for - in- in - on - out - to - to - up

1. to open ____in_____ fresh areas _to_ overseas investors

2. to invest heavily ____in______ overseas iron ore, steel and coal mines
3. to relocate production __to____ lower-cost mainland factories
4. to advise Chinese companies ____up_____ their overseas mergers and acquisitions
5. to acquire stakes _____for_____ domestic lenders
6. to sell to foreign investors
UPT- INGLÉS TÉCNICO II – EPCC y F - FACEM

IV. ANSWER THE QUESTIONS ABOUT THE ARTICLE. - (5)

1. For you. Which method of recording inventory is better ? Periodic or perpetual – Support your answer

The Perpetual Inventory System because this system provides as running record of inventories on

hand because under this method stock registers are maintained which will give the inventory balance

at any time desired. it is for the management to provide for continuous stock-taking, so that by

comparing the physical balance with book balance, any discrepancies are ascertained immediately

2. In periods of rising of prices the cost of production will be lower in case of FIFO method. Why?

The reason is that the higher price at which the purchase of materials was made earlier stands

recovered in cost. This method is suitable when the size of purchases is large but not much frequent.

The moderate fluctuations in the prices of materials, and easy comparison between different jobs are

also the important conditions for the use of this method.