Question 1

McKendrick Shoe Store has a beginning inventory of $45,000.During the period, purchases were $195,000; purchase returns, $6,000; and freight-in $15,000.A physical count of inventory at the end of the period revealed that $30,000 was still on hand.The cost of goods available for sale was

Accepted Answer

A)  $189,000.
B)  $204,000.
C)  $219,000.
D)  $249,000.

Question 2

Which one of the following transactions is recorded with the same entry in a perpetual and a periodic inventory system?

Accepted Answer

A)  Cash received on account with a discount
B)  Payment of freight costs on a purchase
C)  Return of merchandise sold
D)  Sale of merchandise on credit

Question 3

Net sales is sales revenue less

Accepted Answer

A)  sales discounts.
B)  sales returns.
C)  sales returns and allowances.
D)  sales discounts and sales returns and allowances.

Question 4

Detailed records of goods held for resale are not maintained under a

Accepted Answer

A)  perpetual inventory system.
B)  periodic inventory system.
C)  double entry accounting system.
D)  single entry accounting system.

Question 5

Prepare the necessary journal entries on the books of Kelly Carpet Company to record the following transactions, assuming a perpetual inventory system (you may omit explanations):
(a) Kelly purchased $45,000 of merchandise on account, terms 2/10, n/30.
(b) Returned $3,000 of damaged merchandise for credit.
(c) Paid for the merchandise purchased within 10 days.

Accepted Answer

The answer of Prepare the necessary journal entries on the...

Question 6

On October 4, 2022, JT Corporation had credit sales transactions of $4,000 from merchandise having cost $2,400.The entries to record the day's credit transactions include a

Accepted Answer

A)  debit of $4,000 to Inventory.
B)  credit of $4,000 to Sales Revenue.
C)  debit of $2,400 to Inventory.
D)  credit of $2,400 to Cost of Goods Sold.

Question 7

Company A sells $2,500 of merchandise on account to Company B with credit terms of 2/10, n/30.If Company B remits a check taking advantage of the discount offered, what is the amount of Company B's check?

Accepted Answer

A)  $1,750
B)  $2,000
C)  $2,250
D)  $2,450

Question 8

The respective normal account balances of Purchases, Purchase Discounts, and Freight-In are

Accepted Answer

A)  credit, credit, debit.
B)  debit, credit, credit.
C)  debit, credit, debit.
D)  debit, debit, debit.

Question 9

Net income is gross profit less

Accepted Answer

A)  financing expenses.
B)  operating expenses.
C)  other revenues and losses.
D)  other income.

Question 10

Accepted Answer

The journal entry to record a return of merchandise purchased on account under a periodic inventory system would be

Question 11

Under IFRS, income statement items are generally described as

Accepted Answer

A)  administration, distribution, manufacturing, etc.
B)  salaries, depreciation, utilities, etc.
C)  administration, depreciation, manufacturing, etc.
D)  salaries, distribution, utilities, etc.IFRS.

Question 12

If a merchandising company sells land at more than its cost, the gain should be reported in the sales revenue section of the income statement.

Accepted Answer

A) True 
 B)False

Question 13

The primary source of revenue for a wholesaler is

Accepted Answer

A)  investment income.
B)  service fees.
C)  the sale of merchandise.
D)  the sale of fixed assets the company owns.

Question 14

Scruffy Brothers Supply uses a periodic inventory system.During May, the following transactions and events occurred.  Instructions
Journalize the May transactions for Scruffy Brothers.You may omit explanations.

Accepted Answer

The answer of Scruffy Brothers Supply uses a periodic inventory...

Question 15

Garth Company sold goods on account to Kyle Enterprises with terms of 2/10, n/30.The goods had a cost of $600 and a selling price of $1,100.Both Garth and Kyle use a perpetual inventory system.Record the sale on the books of Garth and the purchase on the books of Kyle.

Accepted Answer

Journal en...

Question 16

The operating expense section of an income statement for a wholesaler would not include

Accepted Answer

A)  freight-out.
B)  utilities expense.
C)  cost of goods sold.
D)  insurance expense.

Question 17

Cost of goods available for sale is computed by adding

Accepted Answer

A)  beginning inventory to net purchases.
B)  beginning inventory to the cost of goods purchased.
C)  net purchases and freight-in.
D)  purchases to beginning inventory.

Question 18

If a company determines cost of goods sold each time a sale occurs, it

Accepted Answer

A)  must have a computer accounting system.
B)  uses a combination of the perpetual and periodic inventory systems.
C)  uses a periodic inventory system.
D)  uses a perpetual inventory system.

Question 19

An enterprise which sells goods to customers is known as a

Accepted Answer

A)  proprietorship.
B)  corporation.
C)  retailer.
D)  service firm.

Question 20

Cleese Company sells merchandise on account for $5,000 to Langston Company with credit terms of 2/10, n/30.Langston Company returns $1,000 of merchandise that was damaged, along with a check to settle the account within the discount period.What is the amount of the check?

Accepted Answer

A)  $3,920
B)  $4,000
C)  $4,900
D)  $4,920

Exam 5: Accounting for Merchandising Operations

If a merchandising company sells land at more than its cost, the gain should be reported in the sales revenue section of the income statement.

Correct Answer
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Cleese Company sells merchandise on account for $5,000 to Langston Company with credit terms of 2/10, n/30.Langston Company returns $1,000 of merchandise that was damaged, along with a check to settle the account within the discount period.What is the amount of the check?

Correct Answer
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The operating expense section of an income statement for a wholesaler would not include

Correct Answer
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Company A sells $2,500 of merchandise on account to Company B with credit terms of 2/10, n/30.If Company B remits a check taking advantage of the discount offered, what is the amount of Company B's check?

Correct Answer
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Under IFRS, income statement items are generally described as

Correct Answer
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The primary source of revenue for a wholesaler is

Correct Answer
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Scruffy Brothers Supply uses a periodic inventory system.During May, the following transactions and events occurred. Instructions Journalize the May transactions for Scruffy Brothers.You may omit explanations.

Correct Answer
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Cost of goods available for sale is computed by adding

Correct Answer
verified

Correct Answer
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If a company determines cost of goods sold each time a sale occurs, it

Correct Answer
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Which one of the following transactions is recorded with the same entry in a perpetual and a periodic inventory system?

Correct Answer
verified

On October 4, 2022, JT Corporation had credit sales transactions of $4,000 from merchandise having cost $2,400.The entries to record the day's credit transactions include a

Correct Answer
verified

Garth Company sold goods on account to Kyle Enterprises with terms of 2/10, n/30.The goods had a cost of $600 and a selling price of $1,100.Both Garth and Kyle use a perpetual inventory system.Record the sale on the books of Garth and the purchase on the books of Kyle.

Correct Answer
verified
Journal en...
View Answer

An enterprise which sells goods to customers is known as a

Correct Answer
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Detailed records of goods held for resale are not maintained under a

Correct Answer
verified

Correct Answer
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Net income is gross profit less

Correct Answer
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Net sales is sales revenue less

Correct Answer
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McKendrick Shoe Store has a beginning inventory of $45,000.During the period, purchases were $195,000; purchase returns, $6,000; and freight-in $15,000.A physical count of inventory at the end of the period revealed that $30,000 was still on hand.The cost of goods available for sale was

Correct Answer
verified

The respective normal account balances of Purchases, Purchase Discounts, and Freight-In are

Correct Answer
verified

Exam 5: Accounting for Merchandising Operations

If a merchandising company sells land at more than its cost, the gain should be reported in the sales revenue section of the income statement.

Correct AnswerverifiedShow Answer

Cleese Company sells merchandise on account for $5,000 to Langston Company with credit terms of 2/10, n/30.Langston Company returns $1,000 of merchandise that was damaged, along with a check to settle the account within the discount period.What is the amount of the check?

Correct AnswerverifiedShow Answer

The operating expense section of an income statement for a wholesaler would not include

Correct AnswerverifiedShow Answer

Company A sells $2,500 of merchandise on account to Company B with credit terms of 2/10, n/30.If Company B remits a check taking advantage of the discount offered, what is the amount of Company B's check?

Correct AnswerverifiedShow Answer

Under IFRS, income statement items are generally described as

Correct AnswerverifiedShow Answer

The primary source of revenue for a wholesaler is

Correct AnswerverifiedShow Answer

Scruffy Brothers Supply uses a periodic inventory system.During May, the following transactions and events occurred. Instructions Journalize the May transactions for Scruffy Brothers.You may omit explanations.

Correct AnswerverifiedShow Answer

Cost of goods available for sale is computed by adding

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

If a company determines cost of goods sold each time a sale occurs, it

Correct AnswerverifiedShow Answer

Which one of the following transactions is recorded with the same entry in a perpetual and a periodic inventory system?

Correct AnswerverifiedShow Answer

On October 4, 2022, JT Corporation had credit sales transactions of $4,000 from merchandise having cost $2,400.The entries to record the day's credit transactions include a

Correct AnswerverifiedShow Answer

Garth Company sold goods on account to Kyle Enterprises with terms of 2/10, n/30.The goods had a cost of $600 and a selling price of $1,100.Both Garth and Kyle use a perpetual inventory system.Record the sale on the books of Garth and the purchase on the books of Kyle.

Correct AnswerverifiedJournal en...View AnswerShow Answer

An enterprise which sells goods to customers is known as a

Correct AnswerverifiedShow Answer

Detailed records of goods held for resale are not maintained under a

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

Net income is gross profit less

Correct AnswerverifiedShow Answer

Net sales is sales revenue less

Correct AnswerverifiedShow Answer

McKendrick Shoe Store has a beginning inventory of $45,000.During the period, purchases were $195,000; purchase returns, $6,000; and freight-in $15,000.A physical count of inventory at the end of the period revealed that $30,000 was still on hand.The cost of goods available for sale was

Correct AnswerverifiedShow Answer

The respective normal account balances of Purchases, Purchase Discounts, and Freight-In are

Correct AnswerverifiedShow Answer

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Journal en...
View Answer

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