Acctg. 211 – Ch. 5 Practice Exam

which of the following line items will appear on the IS of a merchandiser but not of a service company? depreciation exp, salaries exp, supplies inventory, cost of goods sold

the term "inventory" for a merchandiser refers to

an entity that buys goods and sells them to customers at a markup is a

gross profit (GP) is calculated as the difference between net sales revenue and ___

the main expense of a merchandiser is

____ are the expenses that occur in an entity' major line of business

merchandise inventory acctg systems can be broadly categorized into 2 types:

on jan 21 2014, bessant inc received merch. from mullies inc. on that date, it found a few of these goods to be damaged. on jan 22, it returned the damaged goods to the seller. such returns will be treated as _____ by bessant.

under the perpetual inv. system, when a wholesaler returns the goods purchased on acct, the _____ acct. is credited. merch. inv., acct. payable, AR, COGS

the term "freight out" refers to

VB specialty foods, a grocery merchandiser, purchased goods and paid transportation to bring them to the company warehouse. the transportation cost is known as:

what does "2/10" mean w respect to "credit terms of 2/10. n/30"?

which is true of freight in? it's an admin. exp.; it's the transportation cost on purchases; it's a selling expense; it's the transportation cost on sales

if goods are sold on terms FOB shipping point, the _____

the terms of an invoice are 3/10, n/25. that means that a _____

an invoice for an amoun of $600 for merch purchased is showing 2/15, n/30 as terms of credit. if the invoice is paid on or before the 15th day, the amount to be paid is: $612; $600; $588; $615

under which of the following terms will the buyer be required to pay transportation costs?

FOB destination refers to a situation where title to goods while in transit vests with the ____

***under the perpetual inventory system, discounts taken on an invoice by the buyer would be: debited to COGS; credited to merch inv; debited to merch inv; credited to COGS

a company ships goods to a customer, and pays transportation costs. to the seller, the transportation costs so paid are known as:

a company has purchased inventory and received an invoice that requires the buyer to pay the transportation costs for delivering the merchandise. the terms in this case are:

*** the purpose of reviewing FOB terms on the invoice is to: calculate the amount of freight payable; to decide and conform the transporter; identify the person liable to pay freight; to locate the transporter

a company sold merchandise with a cost of $221 for $350 on account. the seller uses the perpetual inventory system. the entry to record the cost of merchandise sold would include:

what is true of net sales revenue

the normal balances of Sales, Sales Discounts, and Sales Returns and Allowance are:

under a perpetual inventory system, merchandise returned by a customer to the seller is recorded as a ____ in the books of a seller

michelin jewelers uses the perpetual inventory system. on april 2, michelin sold merchandise with a cost of $5,500 for $9000 to a customer on account w terms 3/15, n/30. which of the following journal entries correctly records the sales revenue?

a merchandiser sold merch inv on account. the journal entry to record sales allowances in the books of a merchandiser using the perpetual inventory system would be _____

under the perpetual inv system, the journal entires to record sales returns (the original sale was on account) would be _____

the sales discounts account is a contra account to the

gross profit is calculated as

delivery expense is a(n) ______

gross profit represents the mark-up on _____

under the perpetual inv system, the journal entry to record cost of goods sold when a product is sold is ____

the inventory account balance is $50,000. an actual count of inventory reveals that actual inventory is $43,000. which would be included in the adjusting entry? (assume perpetual inv system)

the merch inv. account of a company shows a balance of $50,000 but a physical count of inv shows $48,000. which entry is required to record the shrinkage? (Assume perpetual)

the revenue, expenses, Sales Returns and Allowances, and Sales Discounts will be closed via the _______

the general ledger shows a balance of $67,900 in the merch inv. account at the end of the period. the physical inventory count shows inventory of $65,300. the adjusting entry includes a ______.

the income summary account has a credit balance of $25,000 after the revenue and expense accounts have been closed. which of the following is to be credited to close the income summary account?

sales rev: 230,000 cogs: 150,000 int. rev: 10,000 operating exps. 42,500 sales discounts: 20,000 sales returns and allowances: 5,000 calculate operating income: 12,500 230,000 67,500 35,000

which is subtracted from Net Sales Revenue to arrive at Gross Profit on a multi-step income statement?

on a multi-step income statement, the operating expenses are subtracted from ____ to arrive at operating income

merchandise inventory and cost of goods sold appear

which is added to operating income to arrive at net income?

which is the correct order of subtotals on a multi-step IS?

which of the following is shown on a multi-step IS, but not on a single-step IS?

*** in a multi-step income statement, which of the following items is excluded from the calculation of operating income? interest expense; administrative expense; selling expense; sales revenue

what is the correct formula for calculating gross profit percentage?

the gross profit percentage is one of the most important measures of

which is true of the gross profit percentage?