Exam 5: Merchandising Operations

On November 1,2017,Rodgers Enterprises sold merchandise with a cost of $7,000 for $25,000,FOB destination,with payment terms of 2/10,n/40.The company paid transportation costs of $100.Customer returns on this sale were $5,000 (with a cost of $2,500).The merchandise was returned on November 6.The company received the payment for the balance amount on November 10,2017.Calculate the net sales revenue.

Freight out is an addition to the Merchandise Inventory account if the seller uses the perpetual inventory system.

If purchase allowances are granted,the buyer need not return the goods to the seller.

Credit terms of 2/10,n/30 indicate that a discount of 2% will be given if payment is made within 10 days of the invoice date.Otherwise,the total invoice amount is due within 30 days of the invoice date.

A company sold merchandise for $24,000 on account with terms of 5/15,n/30.The company uses a perpetual inventory system.After two days,it received defective merchandise worth $4,000.The journal entry to record the cash receipt for the sale if the payment is received within 10 days of the invoice date would include ________.

In a periodic inventory system,the Cost of Goods Sold account is continuously updated as and when sales occur.

On November 1,2017,Lotz Company sold merchandise for $16,000,FOB destination,with payment terms of 2/10,n/40.Customer returns on this sale amounted to $4,000.The company received payment for the balance on November 10,2017.The cost of goods sold was $3,600.Calculate the amount of gross profit from these transactions.

An invoice,with payment terms of 6/10,n/30,was issued on April 28 for $230.00.If the payment was made on May 12,the amount of payment will be ________.(Round your answer to the nearest cent. )

A company that uses the perpetual inventory system purchases inventory for $61,000 on account,with terms of 3/10,n/30.Which of the following is the journal entry to record the payment made within 10 days?

When a seller grants a sales allowance,the customer does not return any goods to the seller.

Merchandise inventory accounting systems can be broadly categorized into two types.They are ________.

Journalize the following sales transactions for Outdoor Equipment using the periodic inventory system.Explanations are not required.

Cost of Goods Sold appears on a multi-step income statement but not on a single-step income statement.

Using the periodic inventory system,state which accounts are used and whether the account is debited or credited.All transactions involve the purchase of inventory.

The Merchandise Inventory account balance is $50,000.An physical count of inventory reveals that actual inventory balance is $42,000.Which of the following would be included in the adjusting entry? (Assume a perpetual inventory system. )

A company using the perpetual inventory system purchased inventory worth $540,000 on account with credit terms of 2/15,n/45.Defective inventory of $40,000 was returned 2 days later,and the accounts were appropriately adjusted.If the company paid the invoice 20 days later,the journal entry to record the payment would be ________.

Journalize the following transaction for a merchandiser that uses the perpetual inventory system. Sold goods for cash,$1,200 (cost $750).

In a multi-step income statement,which of the following items is excluded from the calculation of operating income?

The sales revenue of a merchandiser amounted to $22,000,sales returns and allowances amounted to $2,500,and sales discounts amounted to $800.The merchandiser uses a perpetual inventory system.The first entry in the closing process would include ________.

Quality Jewelers uses the perpetual inventory system.On April 2,Quality sold merchandise for $50,000 to a customer on account with terms of 3/15,n/30.The allowances and returns on this sale amounted to $3,000 and $9,000,respectively.The cost of goods sold was $20,000.On April 20,Quality received payment from the customer.Calculate the amount of gross profit.