1. All the following are true about a corporation except: must abide by government rules and regulations. b. is a legal entity. C has only one owner d. must pay taxes. 2. Proof of stock ownership is evidenced by a printed or engraved form known as a a. stock dividend. b. note. C. debenture. d. stock certificate. 3. a In order to be classified as merchandise inventory, merchandise must be: owned by the company. b. in a form ready for sale to customers in the ordinary course of business shipped FOB destination. d. both owned by the company and in a form ready for sale to customers in the ordinary course of business. 4. In some lines of business, it is customary to hold the goods of other parties and try to sell the goods for them for a fee. These goods are called: a goods in transit b. work in process. C. merchandise inventory. d. consigned goods. When ownership of the goods passes to the buyer when the public carrier accepts the goods from the seller. The terms are: a. consigned goods. b. FOB destination. C. FOB shipping point. d. none of these answer choices are correct. When ownership of the goods remains with the seller until the goods reach the buyer. The terms are: consigned goods. FOB destination. FOB shipping point. d. none of these answer choices are correct. b. C. 6. Which of the following statements are true regarding FIFO: a. Assumes the last goods purchased are the first to be sold. b. Assumes the first goods purchased are the first to be sold. C. is a depreciation method d. Is used for a service company Which of the following statements are true regarding LIFO: Assumes the last goods purchased are the first to be sold. b. Assumes the first goods purchased are the first to be sold. C. Is a depreciation method d. is used for a service company In a period of increasing prices, the inventory system that will yield the highest net income is: a specific identification b. FIFO. C. LIFO. d. average-cost. 9. Wal-Mart is a prime example of which type organization: a. Merchandising concern. b. Manufacturing concern. c. Service organization. d. Limited partnership 10. If a sales invoice shows credit terms of 2/10, 1/30, the discount period is: 10 days. b. 2 days C. 30 days. d. cannot be determined from the information given. 11. All of the following are characteristics of a corporation except: a a separate legal entity. b. ownership evidenced by shares of stock. produce eight times more revenue than sole proprietorships and partnerships in the United States. owners have unlimited liability 12. The term used to describe the stock representing the primary ownership interest in a corporation is: common stock. b. retrained earnings. c. financing activity. d. dividends