Exam 15: Accounting for Merchandise Inventory

A credit customer purchased $450 worth of items.Two days later,the customer returned $300 worth of those items.The entry to record this under the perpetual inventory method would include:

In a perpetual inventory system,Purchases,Freight-In,and Purchases Returns and Allowances accounts are not used.

A method that uses average gross profit rate and net sales to compute inventory is:

Under the perpetual inventory method,merchandise inventory is assigned to Cost of Goods Sold when a company:

Joe owns an auto parts store called Joe's Auto Care.The following transactions took place during September of the current year. September 9 Purchased merchandise on account from Wheeler Auto for $6,000. September 10 Paid freight charges of $300 on merchandise purchased on the 9^th. September 13 Sold merchandise on account to Lancaster Auto Sales for $5,500. The cost of the merchandise was $3,500. September 15 Received a credit memo from Wheeler for merchandise returned,$900 September 25 Issued a credit memo to Lancaster Auto Sales for merchandise returned,$1,000. The cost of the merchandise is $550. Journalize the above transactions using the periodic inventory system.

A beginning inventory and purchases of computer parts follow: Beginuning inventory 10@\ 10 First purchase 14@\ 12 Second purchase 8@\ 16 Required: Determine the cost of an ending inventory of 6 computer parts remaining in the periodic inventory under each of the assumptions listed.Round to three decimal places. a)________ FIFO b)________ LIFO c)________ Weighted-average

A business uses the retail inventory method to estimate the value of the ending inventory.For the month of May,the cost of goods available for sale is $15,625 at cost and $21,550 at retail.The cost ratio is:

Which of the following would be used to record the payment for purchases under the periodic system?

The journal entry to record the return of a purchase of inventory under the periodic system includes a:

An understatement of ending inventory in one period results in:

This inventory method produces the lowest income tax during a period of inflation.

Customer returned goods purchased on credit - Perpetual Debit ________ & ________ Credit ________ & ________

The inventory method where the ending inventory consists of oldest costs is:

Goods that are consigned to another party:

Title passes from the seller to the buyer under F.O.B.________ when the merchandise arrives at its destination.

In a perpetual inventory system,Cost of Goods Sold is not an account in the general ledger.

The ________ is the one who consigns the merchandise.

Calculate the ending inventory under each of the following methods given the information below about purchases and sales during the year.Assume a periodic inventory system.Round to four decimal places. April 1 Beginning inventory 60 units @\ 30 11 Furchases 80 urits @\ 32 21 Purchases 30 urits @\ 35 Sales for April: 115 units a)________ FIFO b)________ LIFO c)________ Weighted-average

Under the perpetual inventory system,in addition to making the entry to record a return of goods from a customer,a company would:

The full disclosure principle says that if a change is made: