1. The following information was taken from the financial statements of Lea Corporation for December 31, Year 2 and Year 1:

• Year 2 total sales: $5,000,000
• Year 2 total assets: $450,000beginning balance, $600,000ending balance
• Year 1 total sales: $3,500,000
• Year 1 total assets: $565,000beginning balance, $450,000ending balance

The ratio of sales to assets for Year 2 and Year 1 is _____.

1. Year 2, 9.52; Year 1, 6.90
2. Year 2, 11.12; Year 1, 6.90
3. Year 2, 9.52; Year 1, 7.80
4. None of these choices are correct.

2. Which of the following accounts is not used in the closing process for a periodic inventory system?

1. Cost of Merchandise Sold
2. Purchases
3. Purchase Discounts
4. None of these choices are correct.

Purchases Transactions

Nieman Company purchased merchandise on account from a supplier for $6,700, terms 1/10, n/30. Nieman Company returned $1,300 of the merchandise and received full credit.

a. If Nieman Company pays the invoice within the discount period, what is the amount of cash required for the payment? If required, round the answer to the nearest dollar. $

b. What account is credited by Nieman Company to record the return?