Question 1

The accounts payable subsidiary ledger:

Accepted Answer

A)  lists accounts alphabetically. 
B)  lists accounts for which the company owes money. 
C)  has a controlling account in the general ledger. 
D)  All of the above are correct. 
A)  lists accounts alphabetically. 
B)  lists accounts for which the company owes money. 
C)  has a controlling account in the general ledger. 
D)  All of the above are correct.

Question 2

The entry to record a purchase of $13,000 on account, terms of 2/10, n/30, would include a:

Accepted Answer

A)  debit to Purchases Discount for $260. 
B)  credit to Accounts Payable for $13,000. 
C)  debit to Accounts Payable for $13,000. 
D)  credit to Cash for $13,000. 
A)  debit to Purchases Discount for $260. 
B)  credit to Accounts Payable for $13,000. 
C)  debit to Accounts Payable for $13,000. 
D)  credit to Cash for $13,000.

Question 3

A buyer taking a discount for early payment is recorded as a credit to Merchandise Inventory.

Accepted Answer

A) True 
 B)False

Question 4

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

Accepted Answer

A) True 
 B)False

Question 5

The purchase for merchandise inventory does not require approval before payment is made.

Accepted Answer

A) True 
 B)False

Question 6

Joy's Accessories bought 65 necklaces for $12 each on account. The payment terms of 2/10, n/30. In addition, 13 necklaces were returned prior to payment. The entry to record the initial purchase would include:

Accepted Answer

A)  a debit to Accounts Payable for $624. 
B)  a debit to Accounts Payable for $780. 
C)  a debit to Merchandise Inventory for $780. 
D)  a debit to Merchandise Inventory for $13. 
A)  a debit to Accounts Payable for $624. 
B)  a debit to Accounts Payable for $780. 
C)  a debit to Merchandise Inventory for $780. 
D)  a debit to Merchandise Inventory for $13.

Question 7

Returned merchandise for credit under the perpetual inventory method. This will be recorded with:

Accepted Answer

A)  a debit to Accounts Payable and a credit to Sales Returns and Allowances. 
B)  a debit to Sales Returns and Allowances and a credit to Merchandise Inventory. 
C)  a credit to Accounts Payable and a debit to Merchandise Inventory. 
D)  a debit to Accounts Payable and a credit to Merchandise Inventory. 
A)  a debit to Accounts Payable and a credit to Sales Returns and Allowances. 
B)  a debit to Sales Returns and Allowances and a credit to Merchandise Inventory. 
C)  a credit to Accounts Payable and a debit to Merchandise Inventory. 
D)  a debit to Accounts Payable and a credit to Merchandise Inventory.

Question 8

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 on account 
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 on account

Question 9

Office Supplies (not used for resale) bought on account were returned for credit and recorded with a debit to Accounts Payable and a credit to Merchandise Inventory. This error will cause:

Accepted Answer

A)  net income to be overstated. 
B)  net income to be understated. 
C)  no effect on net income or total assets. 
D)  total assets to be understated. 
A)  net income to be overstated. 
B)  net income to be understated. 
C)  no effect on net income or total assets. 
D)  total assets to be understated.

Question 10

Prepare the general journal entries to record the following transaction. All purchases are on account and subject to terms of 2/10, n/30. The perpetual inventory method is in use.
May 5 Purchased merchandise from the Jackson Inc. with a price of $17,000.
May 9 Returned $1,500 worth of merchandise to Jackson Inc.
May 14 Paid the amount due to Jackson Inc.
-Prepare the general journal entry for the May 9 transaction.
__________________________________________ __________ __________
__________________________________________ __________ __________
__________________________________________ __________ __________

Accepted Answer

The answer of Prepare the general journal entries to record...

Question 11

On October 31, Janoch's Dog Kennel purchased $900 of merchandise on account from the Ganster Company. The goods were shipped F.O.B. shipping point. The freight charge of $110 was paid by Ganster Company and added to the invoice. The amount to record in the Merchandise Inventory account is:

Accepted Answer

A)  $900. 
B)  $1,010. 
C)  $790. 
D)  $780. 
A)  $900. 
B)  $1,010. 
C)  $790. 
D)  $780.

Question 12

Determine the amount to be paid within the discount period for purchase with an invoice price of $15,000 and credit terms of 2/10, n/30 when $1,500 has already been returned for credit.
$ ________

Accepted Answer

The answer of Determine the amount to be paid within...

Question 13

Sam's Online Service on April 30 has the following transactions:   If Sam's is offered a 4% discount, but does not pay the invoice in time to receive the discount, how much does Sam owe?

Accepted Answer

A)  $19,000 
B)  $5,000 
C)  $24,000 
D)  $18,240 
A)  $19,000 
B)  $5,000 
C)  $24,000 
D)  $18,240

Question 14

When the term F.O.B. shipping point is used, title passes:

Accepted Answer

A)  when goods reach the halfway point. 
B)  when goods reach the destination. 
C)  when goods are shipped. 
D)  when the buyer signs for the product. 
A)  when goods reach the halfway point. 
B)  when goods reach the destination. 
C)  when goods are shipped. 
D)  when the buyer signs for the product.

Question 15

Compare and contrast the controlling account Accounts Payable to the accounts payable subsidiary ledger. Discuss why the balance of the controlling account, Accounts Payable, does not equal the sum of the accounts payable ledger during the month.

Accepted Answer

The controlling account, Accounts Payabl

Question 16

An entry to record the payment to a vendor was correctly recorded and posted to the general ledger but was not posted to the subsidiary ledger. This error will cause:

Accepted Answer

A)  net income to be overstated. 
B)  the vendor account total in the subsidiary to be less than control total. 
C)  the accounts payable control account to not agree with the subsidiary ledger. 
D)  the accounts receivable control account to not agree with the subsidiary ledger. 
A)  net income to be overstated. 
B)  the vendor account total in the subsidiary to be less than control total. 
C)  the accounts payable control account to not agree with the subsidiary ledger. 
D)  the accounts receivable control account to not agree with the subsidiary ledger.

Question 17

A discount on merchandise purchased would be a:

Accepted Answer

A)  debit to Accounts Receivable, and a credit to Merchandise Inventory. 
B)  debit to Merchandise Inventory, and a credit to Accounts Receivable. 
C)  debit to Accounts Payable, and a credit to Merchandise Inventory. 
D)  debit to Merchandise Inventory, and a credit to Accounts Payable. 
A)  debit to Accounts Receivable, and a credit to Merchandise Inventory. 
B)  debit to Merchandise Inventory, and a credit to Accounts Receivable. 
C)  debit to Accounts Payable, and a credit to Merchandise Inventory. 
D)  debit to Merchandise Inventory, and a credit to Accounts Payable.

Question 18

A form used within a business by the requesting department asking the purchasing department to buy specific goods is called a(n):

Accepted Answer

A)  purchase order. 
B)  purchase requisition. 
C)  credit memorandum. 
D)  employee memorandum. 
A)  purchase order. 
B)  purchase requisition. 
C)  credit memorandum. 
D)  employee memorandum.

Question 19

If a display rack was purchased for the store, which of the following accounts would be increased?

Accepted Answer

A)  Store Equipment 
B)  Merchandise Inventory 
C)  Capital 
D)  Supplies 
A)  Store Equipment 
B)  Merchandise Inventory 
C)  Capital 
D)  Supplies

Question 20

Journalize the following transactions. All purchases are on account and subject to terms of 2/10, n/30. The perpetual inventory method is used.
Nov. 3 Purchased merchandise with a price of $4,000 from the Bart Inc.
Nov. 5 Purchased merchandise from the Thies and Co. with a price of $2,000.
Nov. 7 Purchased merchandise with a price of $2,000 from the Montana Supply Co.
Nov. 10 Paid the amount due to Bart Inc.
Nov. 12 Paid the amount due to Thies and Co.
Nov. 23 Paid the amount due to Montana Supply Co.
-Journalize the Nov. 12 transaction.
__________________________________________ __________ __________
__________________________________________ __________ __________
__________________________________________ __________ __________

Accepted Answer

The answer of Journalize the following transactions. All purchases are...

Exam 10: Purchases and Cash Payments

The accounts payable subsidiary ledger:

The entry to record a purchase of $13,000 on account, terms of 2/10, n/30, would include a:

A buyer taking a discount for early payment is recorded as a credit to Merchandise Inventory.

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

The purchase for merchandise inventory does not require approval before payment is made.

Joy's Accessories bought 65 necklaces for $12 each on account. The payment terms of 2/10, n/30. In addition, 13 necklaces were returned prior to payment. The entry to record the initial purchase would include:

Returned merchandise for credit under the perpetual inventory method. This will be recorded with:

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?

Office Supplies (not used for resale) bought on account were returned for credit and recorded with a debit to Accounts Payable and a credit to Merchandise Inventory. This error will cause:

On October 31, Janoch's Dog Kennel purchased $900 of merchandise on account from the Ganster Company. The goods were shipped F.O.B. shipping point. The freight charge of $110 was paid by Ganster Company and added to the invoice. The amount to record in the Merchandise Inventory account is:

Determine the amount to be paid within the discount period for purchase with an invoice price of $15,000 and credit terms of 2/10, n/30 when $1,500 has already been returned for credit. $ ________

Sam's Online Service on April 30 has the following transactions: If Sam's is offered a 4% discount, but does not pay the invoice in time to receive the discount, how much does Sam owe?

When the term F.O.B. shipping point is used, title passes:

Compare and contrast the controlling account Accounts Payable to the accounts payable subsidiary ledger. Discuss why the balance of the controlling account, Accounts Payable, does not equal the sum of the accounts payable ledger during the month.

An entry to record the payment to a vendor was correctly recorded and posted to the general ledger but was not posted to the subsidiary ledger. This error will cause:

A discount on merchandise purchased would be a:

A form used within a business by the requesting department asking the purchasing department to buy specific goods is called a(n):

If a display rack was purchased for the store, which of the following accounts would be increased?

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

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 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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