Question 1

FOB is short for Free On Board.

Accepted Answer

A) True 
 B)False

Question 2

On June 15, the Greater Gravel Company purchased $700 of merchandise on account from the Digga Ditch Company, terms 4/10, n/30. The goods were shipped F.O.B. shipping point. The freight charge of $40 was paid by Digga Ditch Company and added to the invoice. The amount to record in the Inventory account is

Accepted Answer

A)  $700. 
B)  $740. 
C)  $672. 
D)  $712. 
A)  $700. 
B)  $740. 
C)  $672. 
D)  $712.

Question 3

Fred's Footwear started with $7,000 in Inventory and had the following transaction totals for the month of April:
Sales $20,000
Sales Returns and Allowances 2,000
Cost of Goods Sold 8,000
Purchases 14,000
Freight 1,000
Purchases Returns and Allow. 2,000
Purchases Discounts ???
If ending Inventory for the period is $11,000, what is the total of purchase discounts experienced?

Accepted Answer

A)  $3,000 
B)  $4,000 
C)  $2,000 
D)  $1,000 
A)  $3,000 
B)  $4,000 
C)  $2,000 
D)  $1,000

Question 4

Medeco bought goods for $150 on credit. Medeco returned $50 worth of goods. Terms of the sale were 2/10, n/30. If Medeco pays the amount owed within the discount period, what is the amount they should pay?

Accepted Answer

A)  $100 
B)  $147 
C)  $98 
D)  $150 
A)  $100 
B)  $147 
C)  $98 
D)  $150

Question 5

Purchased office supplies on account. This will be recorded with

Accepted Answer

A)  a debit to Accounts Payable and a credit to Supplies. 
B)  a debit to Supplies and a credit to Supplies Expense. 
C)  a debit to Supplies and a credit to Accounts Payable. 
D)  a credit to Supplies and a debit to Purchases. 
A)  a debit to Accounts Payable and a credit to Supplies. 
B)  a debit to Supplies and a credit to Supplies Expense. 
C)  a debit to Supplies and a credit to Accounts Payable. 
D)  a credit to Supplies and a debit to Purchases.

Question 6

Which account is the controlling account for the amounts owed to individual creditors?

Accepted Answer

A)  Accounts Payable in the general ledger 
B)  Accounts Receivable in the general ledger 
C)  Accounts Receivable in the subsidiary ledger 
D)  Accounts Payable in the subsidiary ledger 
A)  Accounts Payable in the general ledger 
B)  Accounts Receivable in the general ledger 
C)  Accounts Receivable in the subsidiary ledger 
D)  Accounts Payable in the subsidiary ledger

Question 7

A list showing the ending balances owed to individual creditors is called a Schedule of Accounts Payable.

Accepted Answer

A) True 
 B)False

Question 8

The accounts payable subsidiary ledger should equal the control account in the general ledger.

Accepted Answer

A) True 
 B)False

Question 9

Which of the following transactions will cause a liability to be credited and an asset account to be debited when the perpetual inventory system is in use?

Accepted Answer

A)  Recorded the adjustment for depreciation 
B)  Recorded the adjustment for the consumption of supplies 
C)  Purchased merchandise inventory on account 
D)  Purchased office supplies for cash 
A)  Recorded the adjustment for depreciation 
B)  Recorded the adjustment for the consumption of supplies 
C)  Purchased merchandise inventory on account 
D)  Purchased office supplies for cash

Question 10

A debit memo for the return of merchandise is usually recorded in the

Accepted Answer

A)  sales journal. 
B)  purchases journal. 
C)  general journal. 
D)  cash payments journal. 
A)  sales journal. 
B)  purchases journal. 
C)  general journal. 
D)  cash payments journal.

Question 11

R&R Lumber reports a purchases of $40,000, a purchase return of $6,000, and a purchase discount of $1,500. What is the impact on Inventory?

Accepted Answer

A)  $47,500 
B)  $32,500 
C)  $38,500 
D)  $36,000 
A)  $47,500 
B)  $32,500 
C)  $38,500 
D)  $36,000

Question 12

The controlling account is found in the subsidiary ledger for all accounts payable.

Accepted Answer

A) True 
 B)False

Question 13

Defend the proposition that it is more important for a company to pay attention to its accounts receivable than to its accounts payable.

Accepted Answer

To some extent this is True. When it com

Question 14

A characteristic of Cost of Goods Sold is that

Accepted Answer

A)  it has a debit normal balance. 
B)  it reduces net income. 
C)  it is used to record the purchase of merchandise to be resold. 
D)  A and B are correct. 
A)  it has a debit normal balance. 
B)  it reduces net income. 
C)  it is used to record the purchase of merchandise to be resold. 
D)  A and B are correct.

Question 15

Which special journal is used to record merchandise or other items bought on account?

Accepted Answer

A)  Sales journal 
B)  Cash Receipts journal 
C)  Purchases journal 
D)  Cash Payments journal 
A)  Sales journal 
B)  Cash Receipts journal 
C)  Purchases journal 
D)  Cash Payments journal

Question 16

Below are listed several books of original entry. Indicate the journal in which each transaction should be recorded by placing the letters representing the appropriate journal in the space provided.
CP Cash payments journal
CR Cash receipts journal
P Purchases journal
GJ General journal
0. ----CP----- Paid weekly salaries.
a. ________ Purchased merchandise on account.
b. ________ Gave customer credit on account for merchandise returned.
c. ________ Owner invested additional cash in the business.
d. ________ Sold merchandise on account.
e. ________ Received credit on account from a supplier for merchandise returned.
f. ________ Purchased office equipment on account.
g. ________ Sold merchandise for cash.
h. ________ Paid for goods purchased in a.
i. ________ Owner withdrew cash from the business.
j. ________ Paid for advertising expense.

Accepted Answer

a. P
b. GJ
c. CR
d.

Question 17

Match between columns
                        Premises: bought equipment on account
cash purchase
return merchandise purchased
purchased merchandise on account
withdrew money from the business
paid invoice less discount

Accepted Answer

The Answer of record immediately to the subsidiary ledger and is...

Question 18

What is the price of the merchandise if the list price is $800, trade discount is 40%, and the terms are 2/10, EOM?

Accepted Answer

A)  $784 
B)  $800 
C)  $580 
D)  $480 
A)  $784 
B)  $800 
C)  $580 
D)  $480

Question 19

Which of the following events does NOT require a journal entry to be made?

Accepted Answer

A)  A supplier's invoice is received. 
B)  A purchase requisition is completed. 
C)  A purchase order is generated and delivered. 
D)  Both B and C are correct. 
A)  A supplier's invoice is received. 
B)  A purchase requisition is completed. 
C)  A purchase order is generated and delivered. 
D)  Both B and C are correct.

Question 20

The account Inventory includes the shipping costs to the buyer.

Accepted Answer

A) True 
 B)False

FOB is short for Free On Board.

Medeco bought goods for $150 on credit. Medeco returned $50 worth of goods. Terms of the sale were 2/10, n/30. If Medeco pays the amount owed within the discount period, what is the amount they should pay?

Purchased office supplies on account. This will be recorded with

Which account is the controlling account for the amounts owed to individual creditors?

A list showing the ending balances owed to individual creditors is called a Schedule of Accounts Payable.

The accounts payable subsidiary ledger should equal the control account in the general ledger.

Which of the following transactions will cause a liability to be credited and an asset account to be debited when the perpetual inventory system is in use?

A debit memo for the return of merchandise is usually recorded in the

R&R Lumber reports a purchases of $40,000, a purchase return of $6,000, and a purchase discount of $1,500. What is the impact on Inventory?

The controlling account is found in the subsidiary ledger for all accounts payable.

Defend the proposition that it is more important for a company to pay attention to its accounts receivable than to its accounts payable.

A characteristic of Cost of Goods Sold is that

Which special journal is used to record merchandise or other items bought on account?

What is the price of the merchandise if the list price is $800, trade discount is 40%, and the terms are 2/10, EOM?

Which of the following events does NOT require a journal entry to be made?

The account Inventory includes the shipping costs to the buyer.

Accounting Concepts and Procedures: an Introduction

Debits and Credits: Analyzing and Recording Business Transactions

Beginning the Accounting Cycle: Journalizing, Posting, and the Trial Balance

The Accounting Cycle Continued: Preparing Worksheets and Financial Statements

The Accounting Cycle Completed: Closing and Post-Closing Trial Balance

Special Journals and Subsidiary Ledgers: the Basics: Sales and Cash

Banking Procedures and Control of Cash

Payroll Procedures: the Employees Perspective

The Employers Tax Responsibilities: Principles and Procedures

Special Journals With Taxes

Preparing a Worksheet for a Merchandising Company

Completion of the Accounting Cycle for a Merchandising Company

Filters

Exam 7: Special Journals and Subsidiary Ledgers: the Basics: Purchases and Cash Payments Journals

FOB is short for Free On Board.

Medeco bought goods for $150 on credit. Medeco returned $50 worth of goods. Terms of the sale were 2/10, n/30. If Medeco pays the amount owed within the discount period, what is the amount they should pay?

Purchased office supplies on account. This will be recorded with

Which account is the controlling account for the amounts owed to individual creditors?

A list showing the ending balances owed to individual creditors is called a Schedule of Accounts Payable.

The accounts payable subsidiary ledger should equal the control account in the general ledger.

Which of the following transactions will cause a liability to be credited and an asset account to be debited when the perpetual inventory system is in use?

A debit memo for the return of merchandise is usually recorded in the

R&R Lumber reports a purchases of $40,000, a purchase return of $6,000, and a purchase discount of $1,500. What is the impact on Inventory?

The controlling account is found in the subsidiary ledger for all accounts payable.

Defend the proposition that it is more important for a company to pay attention to its accounts receivable than to its accounts payable.

A characteristic of Cost of Goods Sold is that

Which special journal is used to record merchandise or other items bought on account?

What is the price of the merchandise if the list price is $800, trade discount is 40%, and the terms are 2/10, EOM?

Which of the following events does NOT require a journal entry to be made?

The account Inventory includes the shipping costs to the buyer.

Accounting Concepts and Procedures: an Introduction

Debits and Credits: Analyzing and Recording Business Transactions

Beginning the Accounting Cycle: Journalizing, Posting, and the Trial Balance

The Accounting Cycle Continued: Preparing Worksheets and Financial Statements

The Accounting Cycle Completed: Closing and Post-Closing Trial Balance

Special Journals and Subsidiary Ledgers: the Basics: Sales and Cash

Banking Procedures and Control of Cash

Payroll Procedures: the Employees Perspective

The Employers Tax Responsibilities: Principles and Procedures

Special Journals With Taxes

Preparing a Worksheet for a Merchandising Company

Completion of the Accounting Cycle for a Merchandising Company

Filters