78) Calculate: (a) net sales, (b) cost of goods sold, (c) gross profit, and (d) net income from the following:
Sales $3,000 Beginning Inventory $ 500
Sales Discount 50 Net purchases 1,400
Sales Returns & Ending Inventory 700
Allowances 80 Operating Expenses 300
79) Calculate: (a) net sales, (b) cost of goods sold, (c) gross profit, and (d) net income from the following:
Sales $1,300 Beginning Inventory $ 11
Sales Discount 5 Net purchases 1,050
Sales Returns & Ending Inventory 16
Allowances 15 Operating Expenses 100
80) Katelyn Marie‘s Law Firm’s unadjusted trial balance includes the following:
Cash $4,200
Unearned Legal Fees 2,200
Legal Fees Revenue 14,400
Using the above data, record the adjusting entry for $2,000 of the unearned legal fees earned.
81) Why is beginning and ending inventory kept as two separate figures in the cost of goods sold section?
82) Prepare the general journal entry to record the adjustment for inventory:
Beginning inventory $8,000
Ending inventory 7,000
83) Camping is Fun purchased merchandise costing $2,000. Calculate the cost of goods sold under the
following different situations:
a) Beginning inventory $200 and no ending inventory.
b) Beginning inventory $250 and a $300 ending inventory.
c) No beginning inventory and a $150 ending inventory.
84)
Sales
Beginning
Inventory
Purchases
Ending
Inventory
Cost of
Goods
Sold
Gross
Profit
Expense
Net
Income
Or Net
Loss
32
20
16
a)
26
b)
8
c)
85)
Sales
Beginning
Inventory
Purchases
Ending
Inventory
Cost of
Goods
Sold
Gross
Profit
Expense
Net
Income
Or Net
Loss
38
14
d)
18
20
e)
10
8
86)
Sales
Beginning
Inventory
Purchases
Ending
Inventory
Cost of
Goods
Sold
Gross
Profit
Expense
Net
Income
Or Net
Loss
f)
16
20
12
g)
16
h)
-2
87)
Sales
Beginning
Inventory
Purchases
Ending
Inventory
Cost of
Goods
Sold
Gross
Profit
Expense
Net
Income
Or Net
Loss
32
i)
20
14
j)
12
k)
4
11.2 Learning Objective 11-2
1) When completing a worksheet:
A) the ending inventory amount appears in the income statement debit column.
B) the beginning inventory amount appears in the adjustment credit column.
C) the ending inventory amount appears in the unadjusted trial balance debit column of the worksheet.
D) the beginning inventory amount appears in the balance sheet debit column of the worksheet.
2) The balance sheet columns on the worksheet prepared for Boston Foods had subtotals as follows: debit
column, $12,000, and credit column, $10,400. This information indicates that:
A) the company incurred a net income of $1,600.
B) the company incurred a net loss of $1,600.
C) an error was made when preparing the adjustments in the worksheet.
D) a mathematical error was made in the worksheet.
3) The income statement columns on a worksheet have subtotals as follows: debit column, $10,500, and
credit column, $9,000. This indicates that:
A) the company incurred a net loss of $1,500.
B) the company earned a net income of $500.
C) there was an error in the adjustments columns.
D) there was an error in the income statement columns.
4) During the preparation of the worksheet, the $800 balance of the Dennis, Withdrawal account was
extended as a debit to the income statement columns. This error will:
A) overstate net income $800.
B) understate net income $800.
C) overstate net income $1,600.
D) understate net income $1,600.
5) Beginning and ending inventories are $700 and $600, respectively. The income statement debit and
credit columns of the worksheet total $2,500 and $2,500, respectively, not including the adjustment
amounts for beginning and ending inventories. The net income or loss for the period is:
A) $150 net income.
B) $150 net loss.
C) $100 net income.
D) $100 net loss.
6) On the worksheet the beginning Merchandise Inventory account appears in:
A) the adjustment column.
B) the trial balance and the balance sheet columns.
C) the trial balance and adjustment columns.
D) All of these answers are correct.
7) On the worksheet the ending Merchandise Inventory account appears in the:
A) adjusted trial balance and balance sheet columns.
B) adjustment column.
C) adjustment, adjusted trial balance, and income statement columns.
D) adjustment, adjusted trial balance, and balance sheet column.
8) The income summary amounts in the income statement columns of the worksheet represent:
A) income for the period.
B) adjustment for unearned revenue.
C) closing of the Capital account.
D) beginning and ending inventory.
9) Beginning and ending inventories for Webster’s Books are $9,000 and $6,000, respectively. The debit
amounts (not including Income Summary) in the income statement columns of the worksheet total
$14,000, and the credit amounts (not including Income Summary) total $15,500. The firm has a:
A) net income of $1,500.
B) net loss of $1,500.
C) net loss of $3,000.
D) net income of $3,000.
10) Which of the following items generally has a credit balance in the income statement columns of the
worksheet?
A) Purchase Returns and Allowances
B) Purchases
C) Accumulated Depreciation
D) Sales Discounts
11) Which inventory appears in the balance sheet column of the worksheet?
A) Ending inventory
B) Beginning inventory
C) Combination of beginning and ending inventories
D) Inventory does not appear on the balance sheet.
12) The adjusted trial balance on the worksheet:
A) contains balances from the permanent accounts.
B) contains balances from the temporary accounts.
C) contains balances for all accounts with balances.
D) None of the above answers are correct.
13) The trial balance columns on the worksheet are populated using the:
A) general journal.
B) general ledger.
C) subsidiary ledger.
D) None of the above.
14) Sales would be found on the worksheet in the:
A) income statement debit column.
B) income statement credit column.
C) balance sheet debit column.
D) balance sheet credit column.
15) Beginning Merchandise Inventory would be found on the worksheet in the:
A) income statement debit column.
B) income statement credit column.
C) balance sheet debit column.
D) balance sheet credit column.
16) Owner’s Withdrawals would be found on the worksheet in the:
A) income statement debit column.
B) income statement credit column.
C) balance sheet debit column.
D) balance sheet credit column.
17) Owner’s Capital would be found on the worksheet in the:
A) income statement debit column.
B) income statement credit column.
C) balance sheet debit column.
D) balance sheet credit column.
18) Since adjustments are listed on the worksheet, there is no need to record the entries in the general
journal.
19) On the worksheet, purchases appear in the balance sheet columns.
27
20) On the worksheet, the Beginning Inventory account is found on the Balance Sheet and Income
Statement columns.
21) Use the following information to complete the partial worksheet for Rebecca’s Company. Record the
appropriate adjusting entries using the data below and extend the balances over to the adjusted trial
balance columns.
Merchandise inventory—ending $20
Store supplies on hand 4
Depreciation on store equipment 1
Accrued salaries 2
22) Use the following information to complete the partial worksheet for Bill’s Company. Record the
appropriate adjusting entries using the data below and extend the balances over to the adjusted trial
balance columns.
Merchandise inventory—ending $10
Store supplies on hand 3
Depreciation on store equipment 2
Accrued salaries 1
23) Discuss the reasons a company would consider using a periodic inventory system.
24)
Column 1
Column 2
Column 3
Cash
Column 1
Column 2
Column 3
Cash
debit
balance sheet
none
25)
Column 1
Column 2
Column 3
Merchandise
inventory – ending
Column 1
Column 2
Column 3
Merchandise
inventory – ending
debit
balance sheet
increase
26)
Column 1
Column 2
Column 3
Prepaid subscription
Column 1
Column 2
Column 3
Prepaid Subscription
debit
balance sheet
none
27)
Column 1
Column 2
Column 3
Unearned Rent
Revenue
Column 1
Column 2
Column 3
Unearned Rent
Revenue
credit
balance sheet
none
28)
Column 1
Column 2
Column 3
Accumulated
depreciation equip.
Column 1
Column 2
Column 3
Equip.
credit
balance sheet
none
29)
Column 1
Column 2
Column 3
Salaries payable
Column 1
Column 2
Column 3
Salaries payable
credit
balance sheet
none
30)
Column 1
Column 2
Column 3
Salaries expense
Column 1
Column 2
Column 3
Salaries expense
debit
income statement
decrease
31)
Column 1
Column 2
Column 3
Purchases
Column 1
Column 2
Column 3
Purchases
debit
income statement
decrease
32)
Column 1
Column 2
Column 3
Purchase discounts
Column 1
Column 2
Column 3
Purchase discounts
credit
income statement
increase
33)
Column 1
Column 2
Column 3
Purchase returns
and allowances
Column 1
Column 2
Column 3
Purchase returns
and allowances
credit
income statement
increase
34)
Column 1
Column 2
Column 3
Sales
Column 1
Column 2
Column 3
Sales
credit
income statement
increase
35)
Column 1
Column 2
Column 3
Sales returns and
allowances
Column 1
Column 2
Column 3
Sales returns and
allowances
debit
income statement
decrease
36)
Column 1
Column 2
Column 3
Sales discounts
Column 1
Column 2
Column 3
Sales discounts
debit
income statement
decrease
37)
Column 1
Column 2
Column 3
Depreciation
expense
Column 1
Column 2
Column 3
Depreciation
expense
debit
income statement
decrease
38)
Column 1
Column 2
Column 3
Supplies expense
Column 1
Column 2
Column 3
Supplies expense
debit
income statement
decrease