Exam 5: Merchandising Operations

Mason Lawn Equipment uses a perpetual inventory system.Journalize the following sales transactions for this company.Explanations are not required.

A sales allowance is recorded with a credit to Accounts Payable.

A company made net sales revenue of $540,000,and cost of goods sold totaled $324,000.Calculate its gross profit percentage.

The Sales Discounts account is a contra account to the ________ account.

Glasgow Company uses the periodic inventory system.On February 1,the corporation purchased inventory on account for $16,000.The terms were 3/10,n/30.On February 2,it returned damaged goods worth $500 to the supplier and was granted an allowance.Give the journal entry for the payment if the invoice is paid after the discount period.(Round your answers to the nearest dollar. )

Which of the following is true of the gross profit percentage?

The key difference in the closing process under the periodic inventory system is how merchandise inventory is handled.

G-mart,a small-scale grocer,wants to introduce an inventory system to track its inventory.G-mart does not currently use optical scanning registers and computer systems.The perpetual inventory system is most suitable for its operations.

Under the perpetual inventory system,purchase returns or allowances are debited to the Merchandise Inventory account by the purchaser.

A small increase in the gross profit percentage may indicate an important rise in income.

Describe the calculation of cost of goods sold when using the periodic inventory system.

A merchandiser uses a perpetual inventory system.The beginning Owner,Capital balance of the merchandiser was $95,000.During the year,Sales Revenue amounted to $80,000,Sales Returns and Allowances were $1,300,Sales Discounts were $2,700,Cost of Goods Sold was $40,000,and all other expenses totaled $13,000.The company paid $24,000 in withdrawals to the owner.The last step in the closing process would include ________.

The main expense of a merchandiser is usually ________.

The gross profit percentage measures the profitability of each sales dollar above the cost of goods sold.

A merchandiser uses a perpetual inventory system.The third step in the process of closing the accounts of a merchandiser is to ________.

Which of the following entries would be made to record the purchase of inventory on account,if a company uses the perpetual inventory system?

Under the perpetual inventory system,discounts taken on an invoice by the buyer would be ________.

A company that uses the perpetual inventory system purchased inventory for $910,000 on account with terms of 4/7,n/20.Which of the following correctly records the payment made 15 days after the date of invoice?

Net sales revenue is equal to sales revenue less cost of goods sold.

An adjusted trial balance for a merchandiser is given below. Give the journal entry to close the Sales Revenue account.