1.Which of the following do not affect the amounts collected on accounts receivables?

a.credit policy

b.returns policy

c.discounts policy

d.the allowance for doubtful accounts

2.Which of the following would most likely use a periodic inventory system?

a.car dealership

b.heavy metal distributor

c.computer dealership

d.local handcrafted furniture store

3.Which of the following is NOT an inventory account in a manufacturing company?

a.Raw Material

b.Work-in-Process

c.Goods Available For Sale

d.Finished Goods

4.Effective inventory management would have one person place the order for new inventory, a second person check it against the purchase order when it arrives, and a third person record the receipt of inventory in the accounting records. The purpose of this system is

a.to reduce spoilage.

b.to reduce storage costs.

c.to guard against stockouts.

d.to guard against internal theft and collusion.

5.Management may use the cost formula decision tree when determining which cost formula to use. If goods are not interchangeable, managements options are

a.weighted-average.

b.FIFO.

c.Just-in-time.

d.specific identification.

6.When a company is evaluating whether or not to use a perpetual vs. a periodic inventory system the following statement is most accurate.

a.A perpetual inventory system provides far superior information and should be used at any cost.

b.A periodic system is inferior and should never be used if possible.

c.The cost of the system used should be measured against the benefits it provides.

d.Both systems are equally good.