Question 1

The entry to record the receipt of payment within the discount period on a sale of $2,000 with terms of 2/10, n/30 will include a credit to

Accepted Answer

A) Sales Discounts for $40. 
B) Cash for $1,960. 
C) Accounts Receivable for $2,000. 
D) Sales Revenue for $2,000. 
A) Sales Discounts for $40. 
B) Cash for $1,960. 
C) Accounts Receivable for $2,000. 
D) Sales Revenue for $2,000.

Question 2

Freight-in is an account that is subtracted from the Purchases account to arrive at cost of goods purchased.

Accepted Answer

A) True 
 B)False

Question 3

Purchase Returns and Allowances and Purchase Discounts are subtracted from Purchases to produce net purchases.

Accepted Answer

A) True 
 B)False

Question 4

The income statement under IFRS is

Accepted Answer

A) required to include more accounts than GAAP. 
B) a similar format as in GAAP. 
C) excludes many of the accounts found on the GAAP income statement. 
D) can only be presented as a multiple-step income statement.
IFRS. 
A) required to include more accounts than GAAP. 
B) a similar format as in GAAP. 
C) excludes many of the accounts found on the GAAP income statement. 
D) can only be presented as a multiple-step income statement.
IFRS.

Question 5

The number of years of income statement information to be presented is

Accepted Answer

A) 2 years under both GAAP and IFRS. 
B) 3 years under both GAAP and IFRS. 
C) 2 years under GAAP and 3 years under IFRS. 
D) 3 years under GAAP and 2 years under IFRS.
IFRS. 
A) 2 years under both GAAP and IFRS. 
B) 3 years under both GAAP and IFRS. 
C) 2 years under GAAP and 3 years under IFRS. 
D) 3 years under GAAP and 2 years under IFRS.
IFRS.

Question 6

A company shows the following balances:   What is the gross profit rate?

Accepted Answer

A) 30% 
B) 44% 
C) 56% 
D) 70% 
A) 30% 
B) 44% 
C) 56% 
D) 70%

Question 7

In a perpetual inventory system, a return of defective merchandise by a purchaser is recorded by crediting

Accepted Answer

A) Purchases. 
B) Purchase Returns. 
C) Purchase Allowance. 
D) Inventory. 
A) Purchases. 
B) Purchase Returns. 
C) Purchase Allowance. 
D) Inventory.

Question 8

Kate Company uses a perpetual inventory system and purchased inventory from Phoe1.

Accepted Answer

Question 9

Inventory is classified as a current asset in a classified balance sheet.

Accepted Answer

A) True 
 B)False

Question 10

Kern Company sells merchandise on account for $8,000 to Block Company with credit terms of 2/10, n/30.Block Company returns $1,600 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) $6,272 
B) $6,400 
C) $7,840 
D) $7,872 
A) $6,272 
B) $6,400 
C) $7,840 
D) $7,872

Question 11

Goldblum Company has the following account balances:   The cost of goods purchased for the period is

Accepted Answer

A) $80,800. 
B) $88,000. 
C) $94,000. 
D) $104,000. 
A) $80,800. 
B) $88,000. 
C) $94,000. 
D) $104,000.

Question 12

For the income statement, IFRS requires

Accepted Answer

A) single-step approach. 
B) multiple-step approach. 
C) single-step approach or multiple-step approach. 
D) no specific income statement approach.
IFRS. 
A) single-step approach. 
B) multiple-step approach. 
C) single-step approach or multiple-step approach. 
D) no specific income statement approach.
IFRS.

Question 13

Gross profit represents the merchandising profit of a company.

Accepted Answer

A) True 
 B)False

Question 14

Under IFRS, companies can apply revaluation to

Accepted Answer

A) land, buildings, and intangible assets. 
B) land, buildings, but not intangible assets. 
C) intangible assets, but not land or buildings. 
D) no assets.
IFRS. 
A) land, buildings, and intangible assets. 
B) land, buildings, but not intangible assets. 
C) intangible assets, but not land or buildings. 
D) no assets.
IFRS.

Question 15

The gross profit section for a merchandising company appears on both the multiple-step and single-step forms of an income statement.

Accepted Answer

A) True 
 B)False

Question 16

Sales revenue should be recorded in accordance with the matching principle.

Accepted Answer

A) True 
 B)False

Question 17

During 2022, Parker Enterprises generated revenues of $90,000.The company's expenses were as follows: cost of goods sold of $45,000, operating expenses of $18,000 and a loss on the sale of equipment of $3,000. Parker's net income is

Accepted Answer

A) $24,000. 
B) $27,000. 
C) $45,000. 
D) $90,000. 
A) $24,000. 
B) $27,000. 
C) $45,000. 
D) $90,000.

Question 18

A company's unadjusted balance in Inventory will usually not agree with the actual amount of inventory on hand at year-end.

Accepted Answer

A) True 
 B)False

Question 19

Assume that Swann Company uses a periodic inventory system and has these account balances at the end of the period: Purchases $630,000; Purchase Returns and Allowances $25,000; Purchase Discounts $11,000; and Freight-In $19,000; beginning inventory of $45,000; ending inventory of $55,000; and net sales of $750,000.Determine the cost of goods sold.

Accepted Answer

The answer of Assume that Swann Company uses a periodic...

Question 20

Gross profit does not appear

Accepted Answer

A) on a multiple-step income statement. 
B) on a single-step income statement. 
C) to be relevant in analyzing the operations of a merchandiser. 
D) on the income statement if the periodic inventory system is used because it cannot be calculated. 
A) on a multiple-step income statement. 
B) on a single-step income statement. 
C) to be relevant in analyzing the operations of a merchandiser. 
D) on the income statement if the periodic inventory system is used because it cannot be calculated.

The entry to record the receipt of payment within the discount period on a sale of $2,000 with terms of 2/10, n/30 will include a credit to

Freight-in is an account that is subtracted from the Purchases account to arrive at cost of goods purchased.

Purchase Returns and Allowances and Purchase Discounts are subtracted from Purchases to produce net purchases.

The income statement under IFRS is

The number of years of income statement information to be presented is

A company shows the following balances: What is the gross profit rate?

In a perpetual inventory system, a return of defective merchandise by a purchaser is recorded by crediting

Kate Company uses a perpetual inventory system and purchased inventory from Phoe1.

Inventory is classified as a current asset in a classified balance sheet.

Kern Company sells merchandise on account for $8,000 to Block Company with credit terms of 2/10, n/30.Block Company returns $1,600 of merchandise that was damaged along with a check to settle the account within the discount period.What is the amount of the check?

Goldblum Company has the following account balances: The cost of goods purchased for the period is

For the income statement, IFRS requires

Gross profit represents the merchandising profit of a company.

Under IFRS, companies can apply revaluation to

The gross profit section for a merchandising company appears on both the multiple-step and single-step forms of an income statement.

Sales revenue should be recorded in accordance with the matching principle.

During 2022, Parker Enterprises generated revenues of $90,000.The company's expenses were as follows: cost of goods sold of $45,000, operating expenses of $18,000 and a loss on the sale of equipment of $3,000. Parker's net income is

A company's unadjusted balance in Inventory will usually not agree with the actual amount of inventory on hand at year-end.

Gross profit does not appear

Accounting in Action

The Recording Process

Adjusting the Accounts

Completing the Accounting Cycle

Inventories

Fraud, Internal Control and Cash

Accounting for Receivables

Plant Assets, Natural Resources and Intangible Assets

Liabilities

Corporations: Organisations, Stock Transactions and Stockholders Equity

Statement of Cash Flows

Financial Analysis: the Big Picture

Time Value of Money

Payroll Accounting

Other Significant Liabilities

Filters

Exam 5: Accounting for Merchandising Operations

The entry to record the receipt of payment within the discount period on a sale of $2,000 with terms of 2/10, n/30 will include a credit to

Freight-in is an account that is subtracted from the Purchases account to arrive at cost of goods purchased.

Purchase Returns and Allowances and Purchase Discounts are subtracted from Purchases to produce net purchases.

The income statement under IFRS is

The number of years of income statement information to be presented is

A company shows the following balances: What is the gross profit rate?

In a perpetual inventory system, a return of defective merchandise by a purchaser is recorded by crediting

Kate Company uses a perpetual inventory system and purchased inventory from Phoe1.

Inventory is classified as a current asset in a classified balance sheet.

Kern Company sells merchandise on account for $8,000 to Block Company with credit terms of 2/10, n/30.Block Company returns $1,600 of merchandise that was damaged along with a check to settle the account within the discount period.What is the amount of the check?

Goldblum Company has the following account balances: The cost of goods purchased for the period is

For the income statement, IFRS requires

Gross profit represents the merchandising profit of a company.

Under IFRS, companies can apply revaluation to

The gross profit section for a merchandising company appears on both the multiple-step and single-step forms of an income statement.

Sales revenue should be recorded in accordance with the matching principle.

During 2022, Parker Enterprises generated revenues of $90,000.The company's expenses were as follows: cost of goods sold of $45,000, operating expenses of $18,000 and a loss on the sale of equipment of $3,000. Parker's net income is

A company's unadjusted balance in Inventory will usually not agree with the actual amount of inventory on hand at year-end.

Gross profit does not appear

Accounting in Action

The Recording Process

Adjusting the Accounts

Completing the Accounting Cycle

Inventories

Fraud, Internal Control and Cash

Accounting for Receivables

Plant Assets, Natural Resources and Intangible Assets

Liabilities

Corporations: Organisations, Stock Transactions and Stockholders Equity

Statement of Cash Flows

Financial Analysis: the Big Picture

Time Value of Money

Payroll Accounting

Other Significant Liabilities

Filters