11. Under FIFO costing, which costs are asisgned to the goods sold during the period.

a. most recent costs

b. average costs

c. specific costs

d. oldest costs

12. Roberto Company has sales of $1,000,000, sales returns and allowances of $10,000, sales discounts of $2,000, and salary expense-sales of $120,000. What is the amount of net sales?

a. $1,012,000

b. $988,000

c. $1,132,000

d. $868,000

13. Marco Company reported net sales of $1,500,000, cost of goods sold of $800,000, and gross profit of $700,000. Accounts Receivable were $175,000 and $225,000 at the beginning and end of the period, respectively. What is the accounts receivable turnover, rounded to two decimal places?

a. 6.67 times

b. 3.50 times

c. 4.00 times

d. 7.50 times

14. Vanessa Company reported net sales of $1,000,000, cost of goods sold of $600,000, and gross profit of $400,000. Merchandise Inventory was $50,000 and $70,000 at the beginning and end of the period, respectively. What is the inventory turnover, rounded to two decimal places?

a. 6.67 times

b. 8.57 times

c. 10.00 times

d. 12.00 times

15.To an investor, an auditor's notation that financial statements are "not prepared in

conformity with GAAP" means:

a. The statements are unreliable.

b. The statements are not presented in accordance with established accounting

principles.

c. The statements may be unreliable.

d. a, b, and c are correct.

e. b and c are correct.

16. The Office Warehouse had the following account balances: Cash, $25,000; Accounts Receivable, $75,000; Merchandise Inventory, $85,000; Equipment, $225,000; Accumulated Depreciation - Equipment, $45,000; Accounts Payable, $50,000; Salaries Payable, $15,000; and Notes Payable - Long-term, $70,000. What is the current ratio, rounded to two decimal places?

a. 2.70 to 1

b. 2.85 to 1

c. 3.04 to 1

d. 1.37 to 1

17. Historical cost is used to initially record transactions because they are?

a. subjective and verifiable

b. objective and verifiable

c. material and subjective

d. subject to change

18. The two qualitative characteristics of financial reports are?

a. relevance and faithful representation

b. comparability and timeliness

c. verifiability and understandability

d. relevance and materiality

19. Chen Company has net sales of $500,000, cost of goods sold of $300,000, and interest expense of $10,000. What is the amount of gross profit on sales?

a. $200,000

b. $198,000

c. $202,000

d. None of these

20. Going concern is the assumption that an entity will operate indefinitely.

a. True

b. False