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1 . LO 6 . 1 Which of the following is an example of a contra revenue account? sales merchandise inventory sales discounts accounts payable

1. LO 6.1Which of the following is an example of a contra revenue account?
sales
merchandise inventory
sales discounts
accounts payable
2. LO 6.1What accounts are used to recognize a retailers purchase from a manufacturer on credit?
accounts receivable, merchandise inventory
accounts payable, merchandise inventory
accounts payable, cash
sales, accounts receivable
3. LO 6.1Which of the following numbers represents the discount percentage applied if a customer pays within a discount window and credit terms are 3/15, n/60?
3
15
60
3 and 15
4. LO 6.1If a customer purchases merchandise on credit and returns the defective merchandise before payment, what accounts would recognize this transaction?
sales discount, cash
sales returns and allowances, cash
accounts receivable, sales discount
accounts receivable, sales returns and allowances
5. LO 6.2Which of the following is a disadvantage of the perpetual inventory system?
Inventory information is in real-time.
Inventory is automatically updated.
It allows managers to make current decisions about purchases, stock, and sales.
It is cost-prohibitive.
6. LO 6.2Which of the following is an advantage of the periodic inventory system?
frequent physical inventory counts
cost prohibitive
time consuming
real-time information for managers
7. LO 6.2Which of the following is not a reason for the physical inventory count to differ from what is recognized on the companys books?
mismanagement
shrinkage
damage
sale of services to customers
8. LO 6.2Which of the following is not included when computing Net Purchases?
purchase discounts
beginning inventory
purchase returns
purchase allowances
9. LO 6.3Which of the following accounts are used when recording a purchase?
cash, merchandise inventory
accounts payable, merchandise inventory
A or B
cash, accounts payable
10. LO 6.3A retailer pays on credit for $650 worth of inventory, terms 3/10, n/40. If the merchandiser pays within the discount window, how much will the retailer remit in cash to the manufacturer?
$19.50
$630.50
$650
$195
11. LO 6.3A retailer returns $400 worth of inventory to a manufacturer and receives a full refund. What accounts recognize this return before the retailer remits payment to the manufacturer?
accounts payable, merchandise inventory
accounts payable, cash
cash, merchandise inventory
merchandise inventory, cost of goods sold
12. LO 6.3A retailer obtains a purchase allowance from the manufacturer in the amount of $600 for faulty inventory parts. Which of the following represents the journal entry for this transaction if the retailer has already remitted payment?
Accounts Payable debit of $600 and Merchandise Inventory credit of $600.
Cash credit of $600 and Merchandise Inventory credit of $600.
Accounts Payable debit of $600 and credits to Merchandise Inventory of $10 and Cash of $590.
13. LO 6.4Which of the following accounts are used when recording the sales entry of a sale on credit?
merchandise inventory, cash
accounts receivable, merchandise inventory
accounts receivable, sales
sales, cost of goods sold
14. LO 6.4A customer pays on credit for $1,250 worth of merchandise, terms 4/15, n/30. If the customer pays within the discount window, how much will they remit in cash to the retailer?
$1,250
$1,200
$50
$500

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