Solved

Match the Following Definitions and Terms by Placing the Number

Question 197

Matching

Match the following definitions and terms by placing the number that identifies the best definition in the blank space next to the term.

Premises:

Responses:

Inventory losses that can occur as a result of theft or deterioration.

Inventory shrinkage

The abbreviation for free on board; refers to the point when ownership of goods passes to the buyer.

EOM

An income statement format that shows only one subtotal for total expenses.

List price

Products a company owns and intends to sell.

Merchandise inventory.

Expenses that support overall operations and includes expenses related to accounting, human resource management and financial management.

Acid-test ratio

The abbreviation for end-of-month; used to describe credit terms for some transactions.

FOB

The expenses of promoting sales by displaying and advertising merchandise, making sales and delivering goods to customers.

Single-step income statement

The catalog price of an item before any trade discount is deducted.

Selling expenses

A ratio used to assess a company's ability to pay its current liabilities; defined as quick assets divided by current liabilities.

General and administrative expenses

An income statement format that shows detailed computations of net sales and other costs and expenses and reports subtotals for various classes of items.

Multiple-step income statement

Premises:

Inventory losses that can occur as a result of theft or deterioration.

The abbreviation for free on board; refers to the point when ownership of goods passes to the buyer.

An income statement format that shows only one subtotal for total expenses.

Products a company owns and intends to sell.

Expenses that support overall operations and includes expenses related to accounting, human resource management and financial management.

The abbreviation for end-of-month; used to describe credit terms for some transactions.

The expenses of promoting sales by displaying and advertising merchandise, making sales and delivering goods to customers.

The catalog price of an item before any trade discount is deducted.

A ratio used to assess a company's ability to pay its current liabilities; defined as quick assets divided by current liabilities.

An income statement format that shows detailed computations of net sales and other costs and expenses and reports subtotals for various classes of items.

Responses:

Inventory shrinkage

EOM

List price

Merchandise inventory.

Acid-test ratio

FOB

Single-step income statement

Selling expenses

General and administrative expenses

Multiple-step income statement

Correct Answer:

Premises:

Responses:

Inventory losses that can occur as a result of theft or deterioration.

The abbreviation for free on board; refers to the point when ownership of goods passes to the buyer.

An income statement format that shows only one subtotal for total expenses.

Products a company owns and intends to sell.

Expenses that support overall operations and includes expenses related to accounting, human resource management and financial management.

The abbreviation for end-of-month; used to describe credit terms for some transactions.

The expenses of promoting sales by displaying and advertising merchandise, making sales and delivering goods to customers.

The catalog price of an item before any trade discount is deducted.

A ratio used to assess a company's ability to pay its current liabilities; defined as quick assets divided by current liabilities.

An income statement format that shows detailed computations of net sales and other costs and expenses and reports subtotals for various classes of items.