Question 1

Freight-in:

Accepted Answer

A)  adds to the Cost of Goods Sold. 
B)  reduces the Cost of Goods Sold. 
C)  does not affect Cost of Goods Sold. 
D)  increases operating expenses. 
A)  adds to the Cost of Goods Sold. 
B)  reduces the Cost of Goods Sold. 
C)  does not affect Cost of Goods Sold. 
D)  increases operating expenses.

Question 2

The adjustment for Accrued Salaries would be to:

Accepted Answer

A)  debit Salaries Expense; credit Cash. 
B)  debit Salaries Payable; credit Prepaid Salaries. 
C)  debit Salaries Expense; credit Salaries Payable. 
D)  debit Salaries Payable; credit Cash. 
A)  debit Salaries Expense; credit Cash. 
B)  debit Salaries Payable; credit Prepaid Salaries. 
C)  debit Salaries Expense; credit Salaries Payable. 
D)  debit Salaries Payable; credit Cash.

Question 3

The second entry to adjust Merchandise Inventory includes:

Accepted Answer

A)  a debit to Merchandise Inventory. 
B)  a credit to Merchandise Inventory. 
C)  a debit to Income Summary. 
D)  None of these is correct. 
A)  a debit to Merchandise Inventory. 
B)  a credit to Merchandise Inventory. 
C)  a debit to Income Summary. 
D)  None of these is correct.

Question 4

Sales would be found on the worksheet in the:

Accepted Answer

A)  income statement debit column. 
B)  income statement credit column. 
C)  balance sheet debit column. 
D)  balance sheet credit column. 
A)  income statement debit column. 
B)  income statement credit column. 
C)  balance sheet debit column. 
D)  balance sheet credit column.

Question 5

The perpetual inventory method:

Accepted Answer

A)  is used by more and more companies, large and small due to increasing computerization. 
B)  is not used by many companies today. 
C)  is used by companies with a variety of merchandise with low unit prices. 
D)  does not ever require a physical inventory. 
A)  is used by more and more companies, large and small due to increasing computerization. 
B)  is not used by many companies today. 
C)  is used by companies with a variety of merchandise with low unit prices. 
D)  does not ever require a physical inventory.

Question 6

Sam received $8,000 in advance for renting part of his building. What is the entry to record the receipt?

Accepted Answer

A)  Debit Cash; credit Rent Expense 
B)  Debit Cash; credit Prepaid Rent Expense 
C)  Debit Cash; credit Unearned Rent Revenue 
D)  Debit Cash; credit Rental Income 
A)  Debit Cash; credit Rent Expense 
B)  Debit Cash; credit Prepaid Rent Expense 
C)  Debit Cash; credit Unearned Rent Revenue 
D)  Debit Cash; credit Rental Income

Question 7

Unearned Revenue is a liability account used to record rent fees received in advance.

Accepted Answer

A) True 
 B)False

Question 8

Mortgage Payable is found on the balance sheet.

Accepted Answer

A) True 
 B)False

Question 9

What financial statement shows the amount for Freight-In?

Accepted Answer

A)  Balance Sheet 
B)  Statement of Owner's Equity 
C)  Income Statement 
D)  Trial Balance 
A)  Balance Sheet 
B)  Statement of Owner's Equity 
C)  Income Statement 
D)  Trial Balance

Question 10

Owner's Capital would be found on the worksheet in the:

Accepted Answer

A)  income statement debit column. 
B)  income statement credit column. 
C)  balance sheet debit column. 
D)  balance sheet credit column. 
A)  income statement debit column. 
B)  income statement credit column. 
C)  balance sheet debit column. 
D)  balance sheet credit column.

Question 11

The financial statement on which Rental Income would appear is the:

Accepted Answer

A)  income statement. 
B)  owner's equity statement. 
C)  balance sheet. 
D)  trial balance. 
A)  income statement. 
B)  owner's equity statement. 
C)  balance sheet. 
D)  trial balance.

Question 12

On November 1, Call Center received $4,800 for two years' rent in advance from Garrett Company. The November 30 adjusting entry that Call Center should make is to:

Accepted Answer

A)  debit Rental Income; credit Unearned Rent $4,800. 
B)  debit Cash; credit Rental Income $4,800. 
C)  debit Unearned Rent; credit Rental Income $200. 
D)  debit Unearned Rent; credit Rent Expense $200. 
A)  debit Rental Income; credit Unearned Rent $4,800. 
B)  debit Cash; credit Rental Income $4,800. 
C)  debit Unearned Rent; credit Rental Income $200. 
D)  debit Unearned Rent; credit Rent Expense $200.

Question 13

The adjustment for accrued wages was NOT done; this would cause:

Accepted Answer

A)  liabilities to be overstated. 
B)  liabilities to be understated. 
C)  assets to be understated. 
D)  net income to be understated. 
A)  liabilities to be overstated. 
B)  liabilities to be understated. 
C)  assets to be understated. 
D)  net income to be understated.

Question 14

For each of the following, identify in Column 1 the balance the account will have in the adjusted trial balance columns (debit or credit), in Column 2 the financial statement column(s) in which the account balance will be found (income statement or balance sheet), and in Column 3 the effect the account will have on the determination of net income (increase, decrease, or none).
-

Accepted Answer

The answer of For each of the following, identify in...

Question 15

Beginning inventory was $3,600, purchases totaled $20,200 and and Cost of Goods Sold was $17,200. What is the ending inventory? Assume gross profit is $0.

Accepted Answer

A)  $3,000 
B)  $600 
C)  $6,600 
D)  $13,600 
A)  $3,000 
B)  $600 
C)  $6,600 
D)  $13,600

Question 16

During the preparation of the worksheet, the $5,000 balance of the Sam, Withdrawal account was extended as a debit to the income statement columns. This error will:

Accepted Answer

A)  overstate net income $5,000. 
B)  understate net income $5,000. 
C)  overstate net income $10,000. 
D)  understate net income $10,000. 
A)  overstate net income $5,000. 
B)  understate net income $5,000. 
C)  overstate net income $10,000. 
D)  understate net income $10,000.

Question 17

On the worksheet, accumulated depreciation appears in the income statement columns.

Accepted Answer

A) True 
 B)False

Question 18

Under the periodic inventory method, the ending inventory is adjusted by debiting Income Summary and crediting Merchandise Inventory.

Accepted Answer

A) True 
 B)False

Question 19

As supplies are used, they become:

Accepted Answer

A)  inventory. 
B)  a liability. 
C)  an expense. 
D)  contra-asset. 
A)  inventory. 
B)  a liability. 
C)  an expense. 
D)  contra-asset.

Question 20

On the worksheet the beginning Merchandise Inventory account appears in:

Accepted Answer

A)  the adjustment column. 
B)  the trial balance and the balance sheet columns. 
C)  the trial balance and adjustment columns. 
D)  All of these answers are correct. 
A)  the adjustment column. 
B)  the trial balance and the balance sheet columns. 
C)  the trial balance and adjustment columns. 
D)  All of these answers are correct.

Exam 11: Preparing a Worksheet for a Merchandise Company

Freight-in:

The adjustment for Accrued Salaries would be to:

The second entry to adjust Merchandise Inventory includes:

Sales would be found on the worksheet in the:

The perpetual inventory method:

Sam received $8,000 in advance for renting part of his building. What is the entry to record the receipt?

Unearned Revenue is a liability account used to record rent fees received in advance.

Mortgage Payable is found on the balance sheet.

What financial statement shows the amount for Freight-In?

Owner's Capital would be found on the worksheet in the:

The financial statement on which Rental Income would appear is the:

On November 1, Call Center received $4,800 for two years' rent in advance from Garrett Company. The November 30 adjusting entry that Call Center should make is to:

The adjustment for accrued wages was NOT done; this would cause:

Beginning inventory was $3,600, purchases totaled $20,200 and and Cost of Goods Sold was $17,200. What is the ending inventory? Assume gross profit is $0.

During the preparation of the worksheet, the $5,000 balance of the Sam, Withdrawal account was extended as a debit to the income statement columns. This error will:

On the worksheet, accumulated depreciation appears in the income statement columns.

Under the periodic inventory method, the ending inventory is adjusted by debiting Income Summary and crediting Merchandise Inventory.

As supplies are used, they become:

On the worksheet the beginning Merchandise Inventory account appears in:

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

Completion of the Accounting Cycle for a Merchandise Company

Accounting for Bad Debts

Notes Receivable and Notes Payable

Accounting for Merchandise Inventory

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

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