Accounting Quiz 3

Some questions(#26-30) pertain to the link below.

https://www.kaltura.com/index.php/extwidget/openGraph/wid/1_epow2174.

Question 1 Merchandising companies include all of the following, except: A. manufacturing and service companies. B. grocery stores. C. wholesalers and retailers. D. book stores. Question 2 A sales invoice for $1,000 was dated October 4 and carried cash discount terms of 2/10, n/30. How much cash will be received if the invoice is paid on October 13? A. $ 960 B. $1,020 C. $ 980 D. $1,000 Question 3 The "Operating Expenses" section of the classified income statement is typically subdivided into: A. selling expenses and administrative expenses. B. selling expenses and advertising expenses. C. selling expenses and other expenses. D. administrative expenses and other expenses. Question 4 From the perspective of the seller, a reduction in the final price paid by the customer because of early payment for goods purchased is called: A. a purchase discount. B. a rebate. C. a sales discount. D. a trade discount. Question 5 Interest expense and interest revenue should be shown under the: A. "Operating Expenses" section. B. "Cost of Goods Sold" section. C. "Operating Revenues" section. D. "Non operating Revenues and Expenses" section. Question 6 Office supplies being used in business would be carried as merchandise inventory of an automobile dealership. True False Question 7 A sales discount of 2/10, n/30 means that a 10 percent discount is granted if the invoice is paid in two days, but the entire balance is due in 30 days. True False Question 8 Given the following information, what is the gross margin percentage? Sales $129,400 Sales discounts 6,100 Sales returns and allowances 4,700 Transportation-In 5,900 Cost of goods sold 58,800 A. 55.4%. B. 47.8% C. 50.4% D. 54.6% Question 9 Cynthia Company had sales of $3,000 for cash and $5,000 on account. How would these sales be recorded in the journal? A. Debit Cash for $3,000 and Sales for $5,000 and credit Accounts Receivable for $8,000. B. Debit Cash for $3,000 and Net Sales for $5,000 and credit Accounts Receivable for $8,000. C. Debit Cash for $3,000 and Accounts Receivable for $5,000 and credit Sales for $8,000. D. Debit Sales for $8,000 and credit Cash for $3,000 and Accounts Receivable for $5,000. Question 10 Beginning inventory on January 1 represents the cost of inventory as of the preceding December 31. True False Question 11 Interest expense and interest revenue would be shown under the "Non operating Revenues and Expenses" category. True False Question 12 Under the periodic inventory procedure, the cost of goods sold for each sale is determined and recorded at the time of sale. True False Question 13 Items of high value with unique characteristics would be best inventoried using the specific identification method. True False Question 14 The most common physical flow of goods in a bakery is last-in, first-out. True False Question 15 Merchandising companies purchase goods in their final form for resale rather than engage in manufacturing these goods. True False Question 16 Under a perpetual inventory system, the Merchandise Inventory account is updated at the time of each sale or purchase. True False Question 17 Generally, inventory cost would include all costs necessary to get goods ready for sale. True False Question 18 During several years of constantly rising prices, the Stetson Company used the LIFO method of inventory valuation, the Mott Company used the FIFO method of inventory valuation, and the Smith Company used the weighted-average method of inventory valuation. In which company would the balance sheet figure for inventory be closer to the current replacement cost of the merchandise on hand? A. Stetson Company B. Smith Company and Mott Company would be similar in this regard. C. Mott Company D. Smith Company Question 19 If the purchase price of a product sold by McNatt Co. rose steadily during the year, cost of goods sold would be greater under FIFO than under LIFO. True False Question 20 If inventory was substantially destroyed by a fire, which of the following methods would be most useful in filing a claim with the insurance company? A. Specific identification method B. Value of the insurance policy method C. Gross margin method D. Periodic inventory procedure Question 21 The lower-of-cost-or-market (LCM) method for pricing ending inventory can be applied using: A. either the unit or the class basis. B. either the unit or the total inventory basis. C. either the class or the total inventory basis. D. either the unit, class, or total inventory basis. Question 22 The specific identification method of determining inventory cost is highly applicable to items such as custom-made jewelry. True False Question 23 The specific identification method's advantages include the company's ability to use this method with: A. little concern for actual prices paid for purchases. B. basically identical units. C. no concern that income will be manipulated. D. items of high value with unique characteristics like automobiles. Question 24 Merchandise inventory is a current asset on the balance sheet of a merchandising company. True False Question 25 The sale of merchandise under the perpetual inventory procedure results in a debit to Cost of Goods Sold. True False Question 26 https://www.kaltura.com/index.php/extwidget/openGraph/wid/1_epow2174 In The Profit's Inventory clips video, Worldwide Trailers is missing how much in inventory? $50,000 $80,000 $100,000 $0 Question 27 In The Profit's Inventory clips video, what percentage of Unique Salon's revenue comes from color? 70% 30% 50% 80% Question 28 In The Profit's Inventory clips video, how much waste does Unique Salon have in waste monthly? 5% 10% 15% 20% Question 29 In The Profit's Inventory clips video, which company overbought a years worth of product that expired because there was no inventory system in place? West End Coffee Worldwide Trailers Unique Salons Planet Popcorn Question 30 In The Profit's Inventory clips video, the new inventory system at Unique Salon writes down products that are used and also scans the products for re-ordering. True False