Question 1

When a customer returns goods to the seller,the seller debits the Purchase Returns account.

Accepted Answer

A) True 
 B)False

Question 2

Refer to the following trial balance.
 
How much is the net sales revenue?

Accepted Answer

A) $461,000 
B) $122,000 
C) $442,000 
D) $116,000 
A) $461,000 
B) $122,000 
C) $442,000 
D) $116,000

Question 3

When a company uses the perpetual inventory system,there is no need to conduct a physical count of inventory.

Accepted Answer

A) True 
 B)False

Question 4

Refer to the following trial balance.
 
How much is the gross profit?

Accepted Answer

A) $152,000 
B) $160,000 
C) $294,000 
D) $69,000 
A) $152,000 
B) $160,000 
C) $294,000 
D) $69,000

Question 5

A merchandiser,following the perpetual inventory system,has the following transactions during August,2017:
   
Credit terms of invoice are 2/15,n/45.Give journal entries for the above transactions.

Accepted Answer

The answer of A merchandiser,following the perpetual inventory system,has the...

Question 6

An invoice is a request by the seller for payment from the purchaser.

Accepted Answer

A) True 
 B)False

Question 7

Which of the following is the correct order of subtotals that appear on a multi-step income statement?

Accepted Answer

A) Operating income,Gross profit,Net income 
B) Gross profit,Net sales revenue,Net income 
C) Net income,Operating income,Net income 
D) Gross profit,Operating income,Net income 
A) Operating income,Gross profit,Net income 
B) Gross profit,Net sales revenue,Net income 
C) Net income,Operating income,Net income 
D) Gross profit,Operating income,Net income

Question 8

Defective,damaged,or otherwise unsuitable merchandise that is returned to the seller is referred to as purchase allowances by the purchaser.

Accepted Answer

A) True 
 B)False

Question 9

A merchandiser had sales returns and allowances of $300,sales discounts of $700,cost of goods sold of $14,000,and all other expenses of $4,400.The merchandiser uses a perpetual inventory system.The second entry in the closing process would include ________.

Accepted Answer

A) a debit to Income Summary for $19,400 
B) a credit to Income Summary for $18,400 
C) a debit to Income Summary for $4,400 
D) a debit to Income Summary for $18,400 
A) a debit to Income Summary for $19,400 
B) a credit to Income Summary for $18,400 
C) a debit to Income Summary for $4,400 
D) a debit to Income Summary for $18,400

Question 10

Gross profit is calculated as the difference between net sales revenue and ________.

Accepted Answer

A) purchases 
B) cost of goods sold 
C) cost of merchandise inventory 
D) selling and administrative expenses 
A) purchases 
B) cost of goods sold 
C) cost of merchandise inventory 
D) selling and administrative expenses

Question 11

In a multi-step income statement,interest revenue and interest expense are included in operating income.

Accepted Answer

A) True 
 B)False

Question 12

Oscar Packers received an allowance from the vendor for an amount of $400.Give the journal entry for this transaction.The company uses a perpetual inventory system.

Accepted Answer

The answer of Oscar Packers received an allowance from the...

Question 13

The Merchandise Inventory account of a company shows a balance of $50,000 but a physical count of inventory shows $43,000 Which of the following entries is required to record the shrinkage? (Assume a perpetual inventory system. )

Accepted Answer

A) 
  
B) 
  
C) 
  
D) 
  
A) 
  
B) 
  
C) 
  
D)

Question 14

Expenses that fall outside the regular operations of a business are ________.

Accepted Answer

A) not shown in the income statement of a merchandiser 
B) treated as current assets and are shown as merchandise inventory 
C) included under the other revenues and expenses section of the income statement 
D) not considered for the calculation of net income 
A) not shown in the income statement of a merchandiser 
B) treated as current assets and are shown as merchandise inventory 
C) included under the other revenues and expenses section of the income statement 
D) not considered for the calculation of net income

Question 15

An adjusted trial balance a merchandiser is given below.
   
Provide journal entries to close the Income Summary account and the Owner,Withdrawals account.

Accepted Answer

@#IMG-DLM& @#IMG-DLM&
Explanation:
*Calc

Question 16

Which of the following statements is not correct?

Accepted Answer

A) In a perpetual inventory system,the "cash register" at the store is a computer terminal that records sales and updates inventory records. 
B) Even in a perpetual inventory system,a business must count inventory at least one a year. 
C) Restaurants and small retail stores often use the periodic inventory system. 
D) In a periodic inventory system,merchandise inventory and purchasing systems are integrated with the records for Accounts Receivable and Sales Revenue. 
A) In a perpetual inventory system,the "cash register" at the store is a computer terminal that records sales and updates inventory records. 
B) Even in a perpetual inventory system,a business must count inventory at least one a year. 
C) Restaurants and small retail stores often use the periodic inventory system. 
D) In a periodic inventory system,merchandise inventory and purchasing systems are integrated with the records for Accounts Receivable and Sales Revenue.

Question 17

Under the perpetual inventory system,the journal entries to record sales returns (the original sale was on account)would be:

Accepted Answer

A) 
  
B) 
  
C) 
  
D) 
  
A) 
  
B) 
  
C) 
  
D)

Question 18

The following information relates to Newman Company.
 
Calculate the net income of Newman Company.

Accepted Answer

A) $6,000 
B) $16,000 
C) $58,000 
D) $240,000 
A) $6,000 
B) $16,000 
C) $58,000 
D) $240,000

Question 19

Under the perpetual inventory system,when a wholesaler returns the goods purchased on account,the ________ account is credited.

Accepted Answer

A) Accounts Receivable 
B) Merchandise Inventory 
C) Cost of Goods Sold 
D) Accounts Payable 
A) Accounts Receivable 
B) Merchandise Inventory 
C) Cost of Goods Sold 
D) Accounts Payable

Question 20

Avery Company uses the periodic inventory system.On February 1,the corporation purchased inventory on account for $10,000.The terms of invoice were 5/10,n/30.The amount due was paid on February 9.Which of the following journal entries correctly records the payment in the books of Avery Company?

Accepted Answer

A) 
  
B) 
  
C) 
  
D) 
  
A) 
  
B) 
  
C) 
  
D)

Exam 5: Merchandising Operations

When a customer returns goods to the seller,the seller debits the Purchase Returns account.

Refer to the following trial balance. How much is the net sales revenue?

When a company uses the perpetual inventory system,there is no need to conduct a physical count of inventory.

Refer to the following trial balance. How much is the gross profit?

A merchandiser,following the perpetual inventory system,has the following transactions during August,2017: Credit terms of invoice are 2/15,n/45.Give journal entries for the above transactions.

An invoice is a request by the seller for payment from the purchaser.

Which of the following is the correct order of subtotals that appear on a multi-step income statement?

Defective,damaged,or otherwise unsuitable merchandise that is returned to the seller is referred to as purchase allowances by the purchaser.

A merchandiser had sales returns and allowances of $300,sales discounts of $700,cost of goods sold of $14,000,and all other expenses of $4,400.The merchandiser uses a perpetual inventory system.The second entry in the closing process would include ________.

Gross profit is calculated as the difference between net sales revenue and ________.

In a multi-step income statement,interest revenue and interest expense are included in operating income.

Oscar Packers received an allowance from the vendor for an amount of $400.Give the journal entry for this transaction.The company uses a perpetual inventory system.

The Merchandise Inventory account of a company shows a balance of $50,000 but a physical count of inventory shows $43,000 Which of the following entries is required to record the shrinkage? (Assume a perpetual inventory system. )

Expenses that fall outside the regular operations of a business are ________.

An adjusted trial balance a merchandiser is given below. Provide journal entries to close the Income Summary account and the Owner,Withdrawals account.

Which of the following statements is not correct?

Under the perpetual inventory system,the journal entries to record sales returns (the original sale was on account)would be:

The following information relates to Newman Company. Calculate the net income of Newman Company.

Under the perpetual inventory system,when a wholesaler returns the goods purchased on account,the ________ account is credited.

Avery Company uses the periodic inventory system.On February 1,the corporation purchased inventory on account for $10,000.The terms of invoice were 5/10,n/30.The amount due was paid on February 9.Which of the following journal entries correctly records the payment in the books of Avery Company?

Accounting and the Business Environment

Recording Business Transactions

The Adjusting Process

Completing the Accounting Cycle

Merchandise Inventory

Accounting Information Systems

Internal Control and Cash

Receivables

Plant Assets, natural Resources, and Intangibles

Current Liabilities and Payroll

Partnerships

Corporations

Long-Term Liabilities

Investments

The Statement of Cash Flows

Financial Statement Analysis

Introduction to Managerial Accounting

Job Order Costing

Process Costing

Cost-Volume-Profit Analysis

Master Budgets

Flexible Budgets and Standard Cost Systems

Cost Allocation and Responsibility Accounting

Short-Term Business Decisions

Capital Investment Decisions

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