A business hired an inexperienced accountant. During the first two weeks on the job, the accountant made the following mistake while making journal entries.For the purchase of equipment on account for $950, Supplies was debited $590, and Accounts Payable was credited $590. What correcting entry is needed to fix this error?

a.Debit Equipment, $950, Credit Accounts Payable $950.

b.Debit Accounts Payable, $590, Debit Supplies, $360, Credit Equipment, $950.

c.Debit Equipment, $950, Credit Supplies, $590, Credit Accounts Payable, $360.

d.Debit Equipment, $950, Credit Accounts Payable, $590, Credit Supplies, $360

A business purchased merchandise at the cost of $15,000 on terms of 1/10 n/45 FOB shipping point. Afterwards, it returned $1,000 of inventory to its supplier. If the business paid within the discount period, how much did it pay to its supplier?

a.$15,000

b.$14,460

c.$13,420

d.$14,800

e.$13,860

A computer was purchased for $2,400 on August 1. The computer is expected to have a five-year useful lifespan before being replaced. If the company's fiscal year is November 30, the following year end adjusting entry will be prepared:

a.debit Depreciation Expense, $200; credit Accumulated Depreciation, $200.

b.debit Depreciation Expense, $40; credit Accumulated Depreciation, $40.

c.debit Depreciation Expense, $120; credit Computer, $120.

d.debit Accumulated Depreciation, $200; credit Depreciation Expense, $200.

e.debit Depreciation Expense, $160; credit Accumulated Depreciation, $160.

A store makes a $1,000 sale on November 30. The customer is sent a statement on December 5 and payment from the customer is received on December 10. The store follows GAAP. When should the $1,000 of revenue be recognized?

a.December 10

b.December 1

c.November 30

d.December 5

A business has a perpetual inventory system. If it buys inventory from a supplier on FOB shipping point terms, what account will be affected if it pays for freight?

a.Freight In

b.Freight Out

c.Cost of Goods Sold

d.Merchandise Inventory

e.None

A retailer recorded sales of $400,000 during 2019. During the year, it reported sales discounts of $10,000, cost of goods sold of $225,000, and operating expenses of $120,000. What the retailer's gross profit for the year?

a.$290,000

b.$165,000

c.$400,000

d.$280,000

e.$175,000

Failure to preparean adjusting entry at the end of the period to record the earning of unearned revenue would cause:

a.an understatement of liabilities and an overstatement of expenses.

b.an overstatement of profits and an understatement of liabilities.

c.an overstatement of assets and an understatement of expenses.

d.an overstatement of assets and an overstatement of revenues.

e.an overstatement of liabilities and an understatement of revenues.

In a periodic inventory system, when the buyer returns previously purchased inventory to its supplier, this entails:

a.a credit to the Purchases account.

b.a credit to the Sales Returns account.

c.a credit to the Accounts Payable account.

d.a credit to the Purchase Returns account.

e.a credit to the Merchandise Inventory account.