1. Last year the Grace Company had net sales of $900,000 and a gross profit of $380,000. Cost of goods available for sale totaled $1,010,000, and ending inventory was $490,000. If purchases for the year were $800,000, what was the amount of beginning inventory? a. $520,000 b. $280,000 c. $310,000 d. $210,000 e. None of these.

2. ABC company received goods costing $67,000 on January 5, 20X4 that was shipped FOB shipping destination on December 29, 20X3. The shipment was a rush order that was arrived January 5, 20X4. The above $67,000 merchandise in transit: a. Should not be included in the Dec. 31, 20X3 ending inventory. b. Should be included in the Dec. 31, 20X3 ending inventory. c. both including or not including in the ending inventory is correct. d. none of the above is correct.

3. The failure to record an accrued revenue will have what effects on the following classifications?

Revenue Assets Liabilities a. Understate Understate None b. Understate None Understate c. Overstate Overstate None d. Overstate None Overstate