6) Gilbert, Inc. generated sales revenues of $1,400,000 in 2017. Its cost of goods sold amounted to $560,000. Calculate Gilbert's gross profit percentage. A) 250% D) 40% C) 167% B) 60% 7) On November 1, 2017, Lotz, Inc. sold merchandise for $10,000, FOB destination, with payment terms of 2/10, n/40. Customer returns on this sale amounted to $5,000. The company received payment for the balance on November 10, 2017. The cost of goods sold was $3,600. Calculate the amount of gross profit from these transactions. A) $1,400 C) $1,300 D) $4,900 B) $6,400 8) Merchandise inventory accounting systems can be broadly categorized into two types. They are B) FIFO and LIFO D) perpetual and periodic A) wholesale and retail C) manufacturer and producer 9) A merchandiser uses a perpetual inventory system. The beginning Retained Earnings balance of the merchandiser was $110,000. During the year, Sales Revenue amounted to $80,000, Sales Returns and Allowances were $2,000, Sales Discounts were $4,000, Cost of Goods Sold was $40,000, and all other expenses totaled $12,000. The company declared and paid $25,000 as dividends. The closing balance of Retained Earnings would be A) $110,000 D) $107,000 C) $111,000 B) $98,000 10) A merchandiser uses a perpetual inventory system. The third step in the process of closing the accounts of a merchandiser is to A) make the revenue accounts equal to zero via the Income Summary account B) make the expense accounts equal to zero via the Income Summary account C) make the Income Summary account equal to zero via the Retained Earnings account D) make the Income Summary account equal to zero via the Dividends account 11) An entity that buys goods and sells them to customers at a markup is a A) merchandiser C) producer B) manufacturer D) service provider 12) The Income Summary account has a credit balance of $20,000 after the revenue and expense accounts have been closed. Which of the following is to be credited to close the Income Summary account? B) Cost of Goods Sold A) Dividends C) Sales Revenue D) Retained Earnings 13) On a balance sheet for a merchandiser, Merchandise Inventory is listed as a(n) A) expense C) revenue B) current asset D) current liabilit 14) Expenses that fall outside the regular operations of a business are A) not considered for the calculation of net income B) treated as current assets and are shown as merchandise inventory C) not shown in the income statement of a merchandiser D) included under the other revenues and expenses section of the income statement