Question 1

The collection of a $1,000 account beyond the 2 percent discount period would result in a(n)

Accepted Answer

The answer of The collection of a $1,000 account beyond...

Question 2

Assuming the use of the periodic inventory system,use the data below to calculate the net cost of purchases and the goods available for sale for the year ended December 31,2010.
 $\begin{array}{lr}
\text {Merchandise Inventory, December 31, 2009 }&\$2,307\
\text { Merchandise Inventory, December 31, 2010}&2,041\
\text {Cost of Goods Sold}&7,604\
\end{array}$

Accepted Answer

The answer of Assuming the use of the periodic inventory...

Question 3

Given the following information,prepare in good form the cost of goods sold section of an income statement for 2010.
 $\begin{array}{ll}
\text { Freight-In } & \$ 8,000 \
\text { Merchandise Inventory, December 31, } 2009 & 30,000 \
\text { Merchandise Inventory, December 31, } 2010 & 32,000 \
\text { Purchases } & 76,000 \
\text { Purchases Returns and Allowances } & 3,600
\end{array}$

Accepted Answer

The answer of Given the following information,prepare in good form...

Question 4

Goods totaling $28,000 purchased February 2 on terms of 2/10,n/30 and on which returns of $1,000 were made on February 10 would be subject to which of the following discounts if paid for on February 12?

Accepted Answer

The discount is 2% for payment within 10 days. The amount of the discount is $28,000 x 2% = $560.

Question 5

Sandy's Supply Store,Inc.,entered into the transactions listed below.In the journal provided,prepare Sandy's entries,assuming use of the perpetual inventory system.Omit explanations.

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The answer of Sandy's Supply Store,Inc.,entered into the transactions listed...

Question 6

Assume that the $5,509 sales made by Exotic Corporation for the month ended December 31,20xx,were made to customers using credit cards.Prepare one journal entry to record these sales assuming that all of the credit card companies charge Exotic a 2 percent discount fee.(Omit date.)Round to the nearest whole dollar.

Accepted Answer

The answer of Assume that the $5,509 sales made by...

Question 7

Given the following information,prepare in good form the cost of goods sold section of an income statement for 2010.
 $$\begin{array} { l r } 
\text { Freight-In } & \$ 24,000 \
\text { Merchandise Inventory. December 31, 2009 } & 90,000 \
\text { Merchandise Inventory. December 31, 2010 } & 102,000 \
\text { Purchases } & 228,000 \
\text { Purchases Returns and Allowances } & 8,400
\end{array}$$

Accepted Answer

The answer of Given the following information,prepare in good form...

Question 8

Assuming the use of the periodic inventory system,use the data below to calculate the net cost of purchases and the goods available for sale for the year ended December 31,2010.
 $\begin{array}{llr}
  \text { Merchandise Inventory, December 31, 2009 } &\$2,830\
 \text { Merchandise Inventory, December 31, 2010 } &3,482\
 \text { Cost of Goods Sold } &18,048
\end{array}$

Accepted Answer

The answer of Assuming the use of the periodic inventory...

Question 9

Compute the dollar amount of each item indicated by a letter in the following table.Treat each horizontal row of numbers as a separate problem.

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The answer of Compute the dollar amount of each item...

Question 10

A purchase on account with an invoice price of $750 has been made.The entry to record the payment after the 2 percent discount period would include a(n)

Accepted Answer

The answer of A purchase on account with an invoice...

Question 11

For a company that takes an average of 50 days to sell inventory,takes an average of 110 days to collect for its sales,and has payment terms of 45 days on its purchases,what is the financing period? Show calculations.

Accepted Answer

The answer of For a company that takes an average...

Question 12

The entry to record a $750 sale with terms of 2/10,n/30 would include a(n)

Accepted Answer

When recording a sale with terms of 2/10,n/30, we first account for the full amount of the sale as an increase to Sales for $750. We do not decrease Accounts Receivable until the payment is received, so option A is incorrect. Option C is also incorrect because the sale qualifies for a 2% discount ($750 x 0.02 = $15), but this amount would be recorded as a decrease to Accounts Receivable if the customer takes the discount. Option D is incorrect because it suggests a decrease to Sales, which is not accurate. Therefore, the correct answer is B, an increase to Sales for $750.

Question 13

From the following data,calculate the amount of gross margin and gross purchases.
 $\begin{array}{llr}
  \text {  Ending Merchandise Inventory} &\$128\
 \text { Purchases Returns and Allowances } &32\
 \text {Beginning Merchandise Inventory  } &160\
 \text { Sales } &1,280\
 \text { Freight-In } &96\
 \text { Cost of Goods Sold } &778\
\text { Purchases Disconuts }&16
\end{array}$

Accepted Answer

The answer of From the following data,calculate the amount of...

Question 14

The entry to record payment of a $1,500 purchase within the 2 percent discount period would include a(n)

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The answer of The entry to record payment of a...

Question 15

Under a perpetual inventory system,is it necessary to take a physical inventory at the end of the period? Why or why not?

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The answer of Under a perpetual inventory system,is it necessary...

Question 16

The collection of a $400 account within the 2 percent discount period would result in a(n)

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The answer of The collection of a $400 account within...

Question 17

Assume that on July 24,20xx,Bond Company had a sale totaling $11,019 with a related cost of goods sold of $7,604.Record this transaction in journal form assuming the perpetual inventory system was in use.

Accepted Answer

The answer of Assume that on July 24,20xx,Bond Company had...

Question 18

Using the following information,calculate for 2010 (a)net sales,(b)cost of goods sold,(c)gross margin,and (d)net income.
 $\begin{array}{lr}
\text { Freight-In } & \$ 11,400 \
\text { Merchandise Inventory, December 31, } 2009 & 130,000 \
\text { Sales } & 320,000\
\text { Purchases Returns and Allowances } & 1,600 \
\text { Advertising Expense } & 18,000 \
\text { Purchases } & 140,000 \
\text { Merchandise Inventory, December 31, } 2010 & 110,000 \
\text { Sales Returns and Allowances } & 11,000 \
\text { General and Administrative Expenses } & 114,000
\end{array}$

Accepted Answer

The answer of Using the following information,calculate for 2010 (a)net...

Question 19

Assume that the sales made by Wessling Corporation for the month ended February 28,20xx,were made to customers using credit cards and totaled $5,666.Prepare one journal entry to record these sales assuming that all of the credit card companies charge Wessling Corporation a 2.5 percent discount fee.(Omit date.)Round to the nearest whole dollar.

Accepted Answer

The answer of Assume that the sales made by Wessling...

Question 20

The entry to record a purchase of $6,000 in merchandise assuming terms of 2/10,n/30 and a periodic inventory system would include a(n)

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The answer of The entry to record a purchase of...

Quiz 5: The Operating Cycle and Merchandising Operations