Exam 15: Accounting for Merchandise Inventory

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 would cause:

If merchandise is purchased ________, the buyer becomes the owner when the merchandise is placed on the carrier.

Shayla's Design uses a periodic inventory system. Shayla sold 33 artist kits during January. Other data for January includes: Ending inventory under the LIFO method is:

Which of the following items should be included in inventory?

Barry's Books uses a periodic inventory system. Barry's Books sold 45 copies of Helpful Hints during September. Other data for September include: Ending inventory under the FIFO method is:

The weighted-average method:

The freight paid on goods purchased F.O.B. shipping point was debited to the Purchases account. This error would cause:

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:

Joe owns an auto parts store called Joe's Auto Care. The following transactions took place during November of the current year. Journalize the above transactions using the periodic inventory system.

The inventory method that assumes the oldest goods are sold first is:

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

Sterling Supply uses a periodic inventory system. Magnum sold 25 globes during March. Other data for March includes: Cost of goods sold under the weighted-average method is:

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

Given the following accounts: Indicate the account(s)to be debited and credited to record the following transactions. -Sold merchandise on account - Periodic

Assume that in Year 1, the ending merchandise inventory is overstated by $30,000. If this is the only error in Years 1 and 2, fill in the items below, indicating which items will be understated, overstated, or correctly stated for Year 2.

Which of the following would not be used to pay for purchases under the periodic system?

Sterling Supply uses a periodic inventory system. Magnum sold 25 globes during March. Other data for March includes: Ending inventory under the weighted-average method is:

A subsidiary payables ledger is used to track details of quantities and costs.

As a result of understating ending inventory by $10,000 at the end of Year 1:

Office Supplies bought on account were returned for credit and recorded with a debit to Accounts Payable and a credit to Merchandise Inventory. This error would cause: