3. A company purchases inventory on Oct 9th for $600 and pays for it on Oct 11th in accordance with the terms of the invoice, which were 3/15, net 30. What is the correct entry on Oct 11th to record the payment?

a. A debit to accounts payable for $600 and a credit to cash for $600

b. A debit to accounts payable for $582, a debit to inventory for $18, and a credit to cash for $600

c. A debit to accounts payable for $600, a credit to cash for $582, and a credit to inventory for $18

d. A debit to accounts payable for $582 and a credit to cash for $582

4. A company sells merchandise to a customer on July 11 with terms of 3/10, net 30.The customer buys 400 blankets at $150 per blanket. They return 20 blankets for full credit and get an additional allowance on the remaining cellphones of $25 per blanket. What is the amount of the check the customer will send the Company if they pay the invoice on July 27th?

a. $47,500

b. $66,500

c. $33,250

d. $61,750

5. Compute the Companys gross profit percentage using the following accounts: Selling Expenses - $13,100 Interest Revenue - $1,500 Sales Returns and Allowances - $5,000 Sales Revenue - $141,000 Cost of Goods Sold - $112,000 Sales Discounts - $1,900 Introduction to Financial Accounting Exam 2 Study Guide Administrative Expenses - $10,100

a. 19.73%

b. 16.48%

c. 17.65%

d. 20.57%

6. Spelker Company purchased 50 items for $750 and in addition, shipping costs were $50 (FOB Shipping point). The company returned 10 items for full credit. They then sold of the inventory for $20 per item. What is the gross profit percentage on the sale of the inventory?

a. 21.62%

b. 18.75%

c. 17.50%

d. 25%

8. Based on the following, compute inventory turnover for 2023. Inventory (December 31, 2022) - $ 525,000 Sales - 2,500,000 Sales returns - 100,000 Cost of sales - 1,750,000 Inventory (December 31, 2023) 575,000

a. 3.04

b. 3.18

c. 1.59

d. 4.73

9. On January 1st the ABC Company purchased 50 chairs for $20 a piece. They purchased another 50 chairs for $25 a piece on June 15th. In July they sold 75 chairs. During December the manufacturer reduced the price for chairs to $15 a piece. The Company uses the FIFO method for valuing inventory. What is the correct value for ABC's inventory at December 31st?

a. $500

b. $375

c. $625 Introduction to Financial Accounting Exam 2 Study Guide

d. $475