Question 1

Gadget Palace is a retailer selling unique hardware.Gadget Palace uses a perpetual inventory system.Journalize the following transactions:
​

Accepted Answer

​

Question 2

The following data for the current year ended June 30 are from the accounting records of Zanadu Co.:
​
   Prepare a multiple-step income statement for the year ended June 30.

Accepted Answer

The answer of The following data for the current year...

Question 3

When merchandise that was sold is returned,a credit to Customer Refunds Payable is made.

Accepted Answer

A) True 
 B)False  False

Question 4

The account form of the balance sheet is presented in a downward sequence in three sections.

Accepted Answer

A) True 
 B)False

Question 5

Determine the amount to be paid in full settlement of each invoice,assuming that credit for returns and allowances was received prior to payment and that all invoices were paid within the discount period.

Accepted Answer

(a)$3,374 ($4,500 - $1,200)- [

Question 6

If merchandise costing $3,500,terms FOB destination,2 / 10,n / 30,with prepaid freight costs of $125,is paid within 10 days,the amount of the purchases discount is $70.

Accepted Answer

A) True 
 B)False

Question 7

During the current year,merchandise is sold for $86,000 cash and for $93,950 on account.The cost of the goods sold is $76,240.What is the amount of the gross profit?

Accepted Answer

Total sales,$179,950

Question 8

When the three sections of a balance sheet are presented on a page in a downward sequence,it is called the

Accepted Answer

A)  account form 
B)  comparative form 
C)  horizontal form 
D)  report form 
A)  account form 
B)  comparative form 
C)  horizontal form 
D)  report form

Question 9

Expenses that are incurred directly or entirely in connection with the selling of merchandise are classified as

Accepted Answer

A)  selling expenses 
B)  general expenses 
C)  other expenses 
D)  administrative expenses 
A)  selling expenses 
B)  general expenses 
C)  other expenses 
D)  administrative expenses

Question 10

The arrangements between buyer and seller as to when payments for merchandise are to be made are called

Accepted Answer

A)  credit terms 
B)  net cash 
C)  cash on demand 
D)  gross cash 
A)  credit terms 
B)  net cash 
C)  cash on demand 
D)  gross cash

Question 11

Purchased goods in transit should be included in the ending inventory of the buyer if the goods were shipped FOB shipping point.

Accepted Answer

A) True 
 B)False

Question 12

Inventory is classified on the balance sheet as a

Accepted Answer

A)  current liability 
B)  current asset 
C)  long-term asset 
D)  long-term liability 
A)  current liability 
B)  current asset 
C)  long-term asset 
D)  long-term liability

Question 13

Inventory normally has a debit balance.

Accepted Answer

A) True 
 B)False

Question 14

Which account is not classified as a selling expense?

Accepted Answer

A)  Sales Salaries 
B)  Delivery Expense 
C)  Cost of Goods Sold​ 
D)  Advertising Expense 
A)  Sales Salaries 
B)  Delivery Expense 
C)  Cost of Goods Sold​ 
D)  Advertising Expense

Question 15

Using the perpetual inventory system,journalize the entries for the following selected transactions:

Accepted Answer

The answer of Using the perpetual inventory system,journalize the entries...

Question 16

Who is responsible for the freight costs when the terms are FOB shipping point?

Accepted Answer

A)  the ultimate customer 
B)  the buyer 
C)  the seller 
D)  either the seller or the buyer 
A)  the ultimate customer 
B)  the buyer 
C)  the seller 
D)  either the seller or the buyer

Question 17

In credit terms of 3 / 15,n / 45,the "3" represents the

Accepted Answer

A)  number of days in the discount period 
B)  full amount of the invoice 
C)  number of days when the entire amount is due 
D)  percent of the cash discount 
A)  number of days in the discount period 
B)  full amount of the invoice 
C)  number of days when the entire amount is due 
D)  percent of the cash discount

Question 18

Buyers and sellers do not normally record the list prices of merchandise and the trade discounts in accounts.

Accepted Answer

A) True 
 B)False

Question 19

A company using the periodic inventory system has inventory costing $210 on hand at the beginning of a period.During the period,merchandise costing $635 is purchased.At year-end,inventory costing $160 is on hand.The cost of goods sold for the year is

Accepted Answer

A)  $795 
B)  $685 
C)  $265 
D)  $635 
A)  $795 
B)  $685 
C)  $265 
D)  $635

Question 20

Service businesses provide services for income,while a merchandising business sells merchandise.

Accepted Answer

A) True 
 B)False

Exam 5: Accounting for Merchandising Businesses

Gadget Palace is a retailer selling unique hardware.Gadget Palace uses a perpetual inventory system.Journalize the following transactions: ​

The following data for the current year ended June 30 are from the accounting records of Zanadu Co.: ​ Prepare a multiple-step income statement for the year ended June 30.

When merchandise that was sold is returned,a credit to Customer Refunds Payable is made.

The account form of the balance sheet is presented in a downward sequence in three sections.

Determine the amount to be paid in full settlement of each invoice,assuming that credit for returns and allowances was received prior to payment and that all invoices were paid within the discount period.

If merchandise costing $3,500,terms FOB destination,2 / 10,n / 30,with prepaid freight costs of $125,is paid within 10 days,the amount of the purchases discount is $70.

During the current year,merchandise is sold for $86,000 cash and for $93,950 on account.The cost of the goods sold is $76,240.What is the amount of the gross profit?

When the three sections of a balance sheet are presented on a page in a downward sequence,it is called the

Expenses that are incurred directly or entirely in connection with the selling of merchandise are classified as

The arrangements between buyer and seller as to when payments for merchandise are to be made are called

Purchased goods in transit should be included in the ending inventory of the buyer if the goods were shipped FOB shipping point.

Inventory is classified on the balance sheet as a

Inventory normally has a debit balance.

Which account is not classified as a selling expense?

Using the perpetual inventory system,journalize the entries for the following selected transactions:

Who is responsible for the freight costs when the terms are FOB shipping point?

In credit terms of 3 / 15,n / 45,the "3" represents the

Buyers and sellers do not normally record the list prices of merchandise and the trade discounts in accounts.

A company using the periodic inventory system has inventory costing $210 on hand at the beginning of a period.During the period,merchandise costing $635 is purchased.At year-end,inventory costing $160 is on hand.The cost of goods sold for the year is

Service businesses provide services for income,while a merchandising business sells merchandise.

Introduction to Accounting and Business

Analyzing Transactions

The Adjusting Process

Completing the Accounting Cycle

Inventories

Internal Control and Cash

Receivables

Long-Term Assets: Fixed and Intangible

Liabilities: Current,installment Notes,and Contingencies

Liabilities: Bonds Payable

Corporations: Organization, stock Transactions, and Dividends

Statement of Cash Flows

Financial Statement Analysis

Introduction to Managerial Accounting

Job Order Costing

Process Cost Systems

Activity-Based Costing

Cost-Volume-Profit Analysis

Variable Costing for Management Analysis

Budgeting

Evaluating Variances From Standard Costs

Evaluating Decentralized Operations

Differential Analysis and Product Pricing

Capital Investment Analysis

Lean Manufacturing and Activity Analysis

Filters

Gadget Palace is a retailer selling unique hardware.Gadget Palace uses a perpetual inventory system.Journalize the following transactions:

The following data for the current year ended June 30 are from the accounting records of Zanadu Co.: Prepare a multiple-step income statement for the year ended June 30.