5. (CH 5) Under a perpetual inventory system, acquisition of merchandise for resale is debited to the

a. Merchandise Inventory account.

b. Purchases account.

c. Supplies account.

d. Cost of Goods Sold account.

6. (CH 6) Kershaw Bookstore had 500 units on hand at January 1, costing $18 each. Purchases and sales during the month of January were as follows:

Date Purchases Sales

Jan. 14 375 @ $28

17 250 @ $20

25 250 @ $22

29 250 @ $32

Kershaw does not maintain perpetual inventory records. According to a physical count, 375 units were on hand at January 31.

The cost of the inventory at January 31, under the FIFO method is:

a. $1,000.

b. $6,750.

c. $7,750.

d. $8,000.

7. (CH 7) If a transaction cannot be recorded in a special journal

a. the company must refuse to enter into the transaction.

b. it is recorded in the general journal.

c. it is recorded directly in the accounts in the general ledger.

d. it is recorded as an adjustment on the work sheet.

8. (CH 8) The cash account shows a balance of $90,000 before reconciliation. The bank statement does not include a deposit of $4,600 made on the last day of the month. The bank statement shows a collection by the bank of $1,880 and a customers check for $640 was returned because it was NSF. A customers check for $790 was recorded on the books as $970, and a check written for $159 was recorded as $195. The correct balance in the cash account was

a. $91,024.

b. $91,096.

c. $91,456.

d. $95,696.