Accounting for merchandising quiz

Financial Accounting Quiz

بواسطة admin في سبتمبر 3, 2023 0

Accounting for merchandising

1 / 13

When goods are purchased for resale by a company using a periodic inventory system :

A) freight costs are debited to Purchases

B) purchases on account are debited to Inventory

C) purchases on account are debited to Purchases

D) purchase returns are debited to Purchase Returns and Allowances

2 / 13

The sales accounts that normally have a debit balance are :

A) Sales Discounts

B) Sales Returns and Allowances

C) Neither (Sales Discounts) nor (Sales Returns and Allowances)

D) (Sales Discounts) and (Sales Returns and Allowances)

3 / 13

The steps in the accounting cycle for a merchandising company are the same as those in a service company except :

A) a multiple-step income statement is required for a merchandising company

B) an additional adjusting journal entry for inventory may be needed in a merchandising company

C) closing journal entries are not required for a merchandising company

D) a post-closing trial balance is not required for a merchandising company

4 / 13

To record the sale of goods for cash in a perpetual inventory system :

A) two journal entries are necessary: one to record the receipt of cash and sales revenue, and one to record the cost of goods sold and reduction of inventory

B) two journal entries are necessary: one to record the receipt of cash and reduction of inventory, and one to record the cost of goods sold and sales revenue

C) only one journal entry is necessary to record the receipt of cash and the sales revenue

D) only one journal entry is necessary to record cost of goods sold and reduction of inventory

5 / 13

Gross profit will result if:

A) operating expenses are less than net income

B) operating expenses are greater than cost of goods sold

C) sales revenues are greater than operating expenses

D) sales revenues are greater than cost of goods sold

6 / 13

In a worksheet using a perpetual inventory system, Inventory is shown in the following columns :

A) income statement credit and balance sheet debit

B) income statement debit and balance sheet debit

C) income statement credit and adjusted trial balance debit

D) adjusted trial balance debit and balance sheet debit

7 / 13

If sales revenues are $500,000, cost of goods sold is $400,000, and operating expenses are $50,000, the gross proft is :

A) $100,000

B) $450,000

C) $50,000

D) $500,000

8 / 13

Which of the following appears on both a single-step and a multiple-step income statement ?

A) Income from operations

B) Gross proft

C) Cost of goods sold

D) Inventory

9 / 13

The multiple step income statement for a merchandising company shows each of the following features except :

A) gross proft

B) cost of goods sold

C) an investing activities section

D) a sales revenue section

10 / 13

A single step income statement :

A) does not report cost of goods sold

B) reports sales revenues and “Other revenues and gains” in the revenues section of the income statement

C) reports operating income separately

D) reports gross proft

11 / 13

In determining cost of goods sold in a periodic system :

A) purchase returns and allowances are deducted from net purchases

B) purchase discounts are deducted from net purchases

C) freight-out is added to net purchases

D) freight-in is added to net purchases

12 / 13

Under a perpetual inventory system, when goods are purchased for resale by a company :

A) freight costs are debited to Freight Out

B) purchases on account are debited to Purchases

C) purchases on account are debited to Inventory

D) purchase returns are debited to Purchase Returns and Allowances

13 / 13

Which of the following accounts will normally appear in the ledger of a merchandising company that uses a perpetual inventory system ?

A) Purchase Discounts

B) Purchases

C) Cost of Goods Sold

D) Freight-In

Your score is

perpetual and periodic inventory systems

Purchase returns and allowances – Purchase discounts – Freight costs

Multiple step income statement * Single step income statement