50.
Which of the following should
not
be classified as inventory in the balance sheet of a large
automobile dealership?
51.
The purchasing agent of Superb Service Co. wants to know the dollar amount of inventory
purchased on account during the year from a particular supplier. This information can be
found most easily in Superb Service’s:
52.
Sutton Supplies reports net sales of $3,750,000, net income of $375,000, and gross profit
of $900,000. The company’s cost of goods sold is:
53.
VanRoy Supplies reports net sales of $1,750,000, net income of $175,000, and gross profit
of $300,000. The company’s cost of goods sold is:
54.
Which of the following appears in the income statement of a merchandising business, but
not
in the income statement of a business that renders only services?
55.
Cumberland, Inc. has applied to its bank for a loan. The bank asks Cumberland’s controller
about the total amount of the company’s accounts receivable. Assuming that all
accounting records are up–to-date, the controller can best answer this question by
referring to:
56.
The Cost of Goods Sold account is closed by:
57.
Under the perpetual inventory system which journal entry would indicate a purchase of
merchandise?
58.
In a perpetual inventory system:
59.
In a perpetual inventory system, two entries usually are made to record each sales
transaction. The purposes of these entries are best described as follows:
60.
Hicksville’s Department Store uses a perpetual inventory system. At year-end, the balance
in the Inventory control account is $1,200,000. Assuming that the inventory records have
been maintained properly, a year-end physical inventory:
6-27
61.
Jayson Products uses a perpetual inventory system. At year-end, the Inventory account
had a balance of $280,000, but a complete year-end physical inventory indicated goods on
hand costing only $273,000. Jayson should:
Reduce its cost of goods sold by $7,000.
Record a $7,000 current liability.
Washington Warehouse is a small retail business that specializes in the sale of top-of-the-
line televisions. This year, the store has begun to carry the Flat TV manufactured by Bass
Co. Thus far, Washington has recorded the following transactions involving the Flat TV:
Jan. 5 Purchased 8 Flat TVs at a unit cost of $1,400
Jan. 18 Purchased 5 additional Flat TVs at $1,400 each
Feb. 12 Sold 9 Flat TVs to the Duke Hotel for $15,300
62.
Refer to the information above. If Washington uses a perpetual inventory system, the
journal entry to record the purchase on January 18th would include which of the following?
63.
Refer to the information above. The gross profit on the Flat TVs as of February 12th is:
64.
Refer to the information above. If Washington uses a perpetual inventory system, the
journal entry to record the sale on February 12th would include all of the following
except
:
65.
Refer to the information above. Washington maintains a subsidiary ledger account for
each type of TV carried in the store. An examination of the account for the Flat TV model
at the end of February would show:
World of Sound is a small retail business that specializes in the sale of top-of-the-line
sound systems. This year, the store has begun to carry the Surround Sound manufactured
by Carp Co. Thus far, World of Sound has recorded the following transactions involving the
Surround Sound
May 5 Purchased 18 units at a unit cost of $2,400
May 18 Purchased 15 additional units at $2,550 each
June 12 Sold 19 units to the Davies Theater
66.
Refer to the information above. If World of Sound uses a perpetual inventory system, the
journal entry to record the purchase on May 18th would include which of the following?
67.
Refer to the information above. If World of Sound uses a perpetual inventory system, the
journal entry to record the sale on February 12th would include which of the following
(World of Sound uses FIFO meaning that the first goods purchased are the first to be
sold)?
68.
Inventory shrinkage is not caused by:
69.
In a periodic inventory system, the formula used in computing the cost of goods sold may
be summarized as follows:
70.
In a periodic inventory system, which of the following accounts may be closed by debiting
Cost of Goods Sold?
71.
In a periodic inventory system, the cost of goods sold is:
72.
Which of the following statements about a periodic inventory system is
not
correct?
73.
The following information is available:
Calculate the gross profit:
6-35
74.
During the year 2015, the inventory of Debra’s Gift Shop decreased by $50,000. If the
income statement for the year 2015 reported cost of goods sold of $350,000, purchases
during the year must have amounted to:
Michael uses its periodic inventory system and the following information is available:
75.
Refer to the information above. What is the cost of goods sold?
76.
Refer to the information above. What is the gross profit?
Bremmer uses a periodic inventory system and the following information is available:
77.
Refer to the information above. What is the cost of goods sold?
78.
Refer to the information above. What is the gross profit?
79.
Merchandising companies that are small and do not use a perpetual inventory system may
elect to use:
80.
Which of the following would
not
tend to make a manufacturer choose a perpetual
inventory system?
81.
Which of the following factors would suggest the use of a perpetual inventory system?
82.
Which of the following companies would be more likely to use a periodic inventory
system?
83.
Which of the following companies would be more likely to use a perpetual inventory
system?