Question 1

When a perpetual inventory system is used,a physical inventory should be taken at least monthly.

Accepted Answer

A) True 
 B)False

Question 2

The specific identification method is a compromise between LIFO and FIFO.

Accepted Answer

A) True 
 B)False

Question 3

Sold merchandise on account.- Periodic
Debit ________ Credit ________

Accepted Answer

The answer of Sold merchandise on account.- Periodic
Debit ________ Credit...

Question 4

Individual inventory items are tracked in the:

Accepted Answer

A) accounts receivable ledger. 
B) purchases journal 
C) accounts payable ledger. 
D) inventory ledger. 
A) accounts receivable ledger. 
B) purchases journal 
C) accounts payable ledger. 
D) inventory ledger.

Question 5

Sterling Supply uses a periodic inventory system.Sterling Supply sold 25 globes during March.Other data for March includes:
$$\begin{array} { | c | l | c | } 
\hline \text { Mar. 1 } & \text { Balance } & 30 @ \$ 12 \
\hline 11 & \text { Purchased } & 20 @ \$ 15 \
\hline 25 & \text { Purchased } & 10 @ \$ 10 \
\hline
\end{array}$$
Round per unit cost to two decimal places.Ending inventory under the weighted-average method is:

Accepted Answer

A) $281.25. 
B) $155.00. 
C) $443.45. 
D) $168.75. 
A) $281.25. 
B) $155.00. 
C) $443.45. 
D) $168.75.

Question 6

The freight paid on goods purchased F.O.B.shipping point was debited to the Freight Expense account.The goods are not sold at period end.The company uses the perpetual inventory method.This error would cause:

Accepted Answer

A) the period end assets to be understated. 
B) the period end liabilities to be understated. 
C) the period's net income to be overstated. 
D) None of these is correct. 
A) the period end assets to be understated. 
B) the period end liabilities to be understated. 
C) the period's net income to be overstated. 
D) None of these is correct.

Question 7

Hard Candy has a beginning inventory of $1,000 with a retail value of $1,800.June purchases were $3,000,with a retail value of $4,700 and retail sales were $4,200.Use four decimal places.What is the June 30 estimated ending inventory at cost under the retail method?

Accepted Answer

A) $351 
B) $949 
C) $4,161 
D) $1,416.42 
A) $351 
B) $949 
C) $4,161 
D) $1,416.42

Question 8

Hall Novelty Shop uses a periodic inventory system.It sold 65 balloons during April.Other data for April includes:
$\begin{array}{|r|l|l|}
\hline\text { Apr. } 1 & \text { Balance } & 40 @ \$ 2.00 \
\hline 11 & \text { Purchased } & 40 @ \$ 4.00 \
\hline 25 & \text { Purchased } & 20 @ \$ 6.00 \
\hline
\end{array}$
Cost of goods sold under the weighted-average method (rounded to the nearest dollar)is:

Accepted Answer

A) $52. 
B) $432. 
C) $234. 
D) $48. 
A) $52. 
B) $432. 
C) $234. 
D) $48.

Question 9

An overstated cost of goods sold of $100 will cause:

Accepted Answer

A) net income to be understated. 
B) net income to be overstated. 
C) merchandise inventory to be understated. 
D) None of these answers is correct. 
A) net income to be understated. 
B) net income to be overstated. 
C) merchandise inventory to be understated. 
D) None of these answers is correct.

Question 10

When using a periodic inventory system,a physical inventory is required.

Accepted Answer

A) True 
 B)False

Question 11

One disadvantage of the LIFO method is that:

Accepted Answer

A) an equal cost is assigned to each unit,so net income does not fluctuate as much as with other methods. 
B) flow of goods and flow of costs are the same. 
C) it matches current selling prices and current costs. 
D) ending inventory is valued at very old costs. 
A) an equal cost is assigned to each unit,so net income does not fluctuate as much as with other methods. 
B) flow of goods and flow of costs are the same. 
C) it matches current selling prices and current costs. 
D) ending inventory is valued at very old costs.

Question 12

The inventory method that matches most recently acquired costs with current selling prices is:

Accepted Answer

A) LIFO. 
B) FIFO. 
C) weighted-average. 
D) specific invoice. 
A) LIFO. 
B) FIFO. 
C) weighted-average. 
D) specific invoice.

Question 13

If a mistake is made in calculating ending inventory,it will take three accounting periods to be self-correcting.

Accepted Answer

A) True 
 B)False

Question 14

When merchandise is sold,the periodic inventory system requires a debit to Cost of Goods Sold and a credit to Merchandise Inventory.

Accepted Answer

A) True 
 B)False

Question 15

St.Paul Corporation had a beginning inventory of $2,500 which would retail for $4,000.They made $9,000 in purchases which would retail at $14,400.The sales for the period were $15,000.What is the estimated cost of ending inventory under the retail inventory method?

Accepted Answer

A) $1,500 
B) $3,400 
C) $4,000 
D) $2,125 
A) $1,500 
B) $3,400 
C) $4,000 
D) $2,125

Question 16

Barry's Books uses a periodic inventory system.Barry's Books sold 40 copies of Helpful Hints during September.Other data for September include:
$$\begin{array} { | c | l | l | } 
\hline \text { Sep. } 1 & \text { Balance } & 10 \text { books } @ \$ 20 \
\hline 8 & \text { Purchased } & 15 \text { books } @ \$ 21 \
\hline 17 & \text { Purchased } & 20 \text { books } @ \$ 22 \
\hline 25 & \text { Purchased } & 20 \text { books } @ \$ 24 \
\hline
\end{array}$$
Ending inventory under the FIFO method is:

Accepted Answer

A) $480. 
B) $515. 
C) $590. 
D) $500. 
A) $480. 
B) $515. 
C) $590. 
D) $500.

Question 17

Journalize the following assuming periodic inventory.
June 20 Made purchases of inventory for $4,500 on account.
June 21 Made sales of $3,500 cash and $2,500 credit.
June 22 Returned $2,000 of purchases for defects.

Accepted Answer

The answer of Journalize the following assuming periodic inventory.
June 20...

Question 18

Sold merchandise on cash - Periodic
Debit ________ Credit ________

Accepted Answer

The answer of Sold merchandise on cash - Periodic
Debit ________...

Question 19

The advantage of the weighted-average method is:

Accepted Answer

A) an equal cost is assigned to each unit so net income does not fluctuate as much as with other methods. 
B) flow of goods and flow of costs are the same. 
C) it matches current selling prices and current costs. 
D) old costs are matched against current income. 
A) an equal cost is assigned to each unit so net income does not fluctuate as much as with other methods. 
B) flow of goods and flow of costs are the same. 
C) it matches current selling prices and current costs. 
D) old costs are matched against current income.

Question 20

Paid for merchandise after the discount period expired.- Periodic
Debit ________ Credit ________

Accepted Answer

The answer of Paid for merchandise after the discount period...

Exam 15: Accounting for Merchandise Inventory

When a perpetual inventory system is used,a physical inventory should be taken at least monthly.

The specific identification method is a compromise between LIFO and FIFO.

Sold merchandise on account.- Periodic Debit ________ Credit ________

Individual inventory items are tracked in the:

Sterling Supply uses a periodic inventory system.Sterling Supply sold 25 globes during March.Other data for March includes: Mar. 1 Balance 30@\ 12 11 Purchased 20@\ 15 25 Purchased 10@\ 10 Round per unit cost to two decimal places.Ending inventory under the weighted-average method is:

The freight paid on goods purchased F.O.B.shipping point was debited to the Freight Expense account.The goods are not sold at period end.The company uses the perpetual inventory method.This error would cause:

Hard Candy has a beginning inventory of $1,000 with a retail value of $1,800.June purchases were $3,000,with a retail value of $4,700 and retail sales were $4,200.Use four decimal places.What is the June 30 estimated ending inventory at cost under the retail method?

Hall Novelty Shop uses a periodic inventory system.It sold 65 balloons during April.Other data for April includes: Apr. 1 Balance 40@\ 2.00 11 Purchased 40@\ 4.00 25 Purchased 20@\ 6.00 Cost of goods sold under the weighted-average method (rounded to the nearest dollar)is:

An overstated cost of goods sold of $100 will cause:

When using a periodic inventory system,a physical inventory is required.

One disadvantage of the LIFO method is that:

The inventory method that matches most recently acquired costs with current selling prices is:

If a mistake is made in calculating ending inventory,it will take three accounting periods to be self-correcting.

When merchandise is sold,the periodic inventory system requires a debit to Cost of Goods Sold and a credit to Merchandise Inventory.

St.Paul Corporation had a beginning inventory of $2,500 which would retail for $4,000.They made $9,000 in purchases which would retail at $14,400.The sales for the period were $15,000.What is the estimated cost of ending inventory under the retail inventory method?

Barry's Books uses a periodic inventory system.Barry's Books sold 40 copies of Helpful Hints during September.Other data for September include: Sep. 1 Balance 10 books @\ 20 8 Purchased 15 books @\ 21 17 Purchased 20 books @\ 22 25 Purchased 20 books @\ 24 Ending inventory under the FIFO method is:

Journalize the following assuming periodic inventory. June 20 Made purchases of inventory for $4,500 on account. June 21 Made sales of $3,500 cash and $2,500 credit. June 22 Returned $2,000 of purchases for defects.

Sold merchandise on cash - Periodic Debit ________ Credit ________

The advantage of the weighted-average method is:

Paid for merchandise after the discount period expired.- Periodic Debit ________ Credit ________

Accounting Concepts and Procedures

Debits and Credits: Analyzing and Recording Business Transactions

Beginning the Accounting Cycle

The Accounting Cycle Continued

The Accounting Cycle Completed

Banking Procedure and Control of Cash

Calculating Pay and Payroll Taxes: the Beginning of the Payroll Process

Paying,recording,and Reporting Payroll and Payroll Taxes:

Sales and Cash Receipts

Purchases and Cash Payments

Preparing a Worksheet for a Merchandise Company

Completion of the Accounting Cycle for a Merchandise Company

Accounting for Bad Debts

Notes Receivable and Notes Payable

Accounting for Property,plant,equipment,and Intangible Assets

Partnership

Corporations: Organizations and Stock

Corporations: Stock Values,dividends,treasury Stocks,

Corporations and Bonds Payable

Statement of Cash Flows

Analyzing Financial Statements

The Voucher System

Departmental Accounting

Manufacturing Accounting

Filters

Sold merchandise on account.- Periodic Debit Credit

Sold merchandise on cash - Periodic Debit Credit

Paid for merchandise after the discount period expired.- Periodic Debit Credit