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QUESTION 30

1. On September 12, Ryan Company sold merchandise in the amount of $7200 to Johnson Company, with credit terms of 2.00/10, n/30. The cost of the items sold is $4700. Ryan uses the periodic inventory system and the net method of accounting for sales. The journal entry or entries that Ryan will make on September 12 is (are):

Accounts receivable 7056

Sales 7056

Cost of goods sold 4700

Merchandise Inventory 4700

Accounts receivable 7056

Sales 7056

Sales 7200

Accounts receivable 7200

Accounts receivable 7200

Sales 7200

Accounts receivable 7200

Sales 7200

Cost of goods sold 4700

Merchandise inventory 4700

QUESTION

1. Mega Skateboard Supplier had net sales of $2.1 million, its cost of goods sold was $1.1 million, and its net income was $0.7 million. Its gross margin ratio equals:

191%.

33%.

52%.

48%.

64%.

QUESTION

1. A company that uses the net method of recording purchases and a perpetual inventory system purchased $2500 of merchandise on July 5 with terms 2/10, n/30. On July 7, it returned $550 worth of merchandise. On July 28, it paid the full amount due. The correct journal entry to record the payment on July 28 is:

2. Debit Accounts Payable $1950; credit Merchandise Inventory $39; credit Cash $1911.

Debit Cash $1950; credit Accounts Payable $1950.

Debit Merchandise Inventory $1950; credit Cash $1950.

Debit Accounts Payable $1911; debit Discounts Lost $39; credit Cash $1950.

Debit Accounts Payable $2500; credit Cash $2500.

QUESTION

1. If assets are $405,000 and equity is $140,000, then liabilities are:

$405,000.

$670,000.

$265,000.

$545,000.

$140,000.

QUESTION

1. Use the following information for Meeker Corp. to determine the amount of equity to report.

Cash $ 74,000

Buildings 128,000

Land 212,200

Liabilities 133,000

$25,200.

$291,200.

$281,200.

$547,200.

$414,200.

QUESTION

1. Giorgio had cost of goods sold of $9457 million, ending inventory of $2125 million, and average inventory of $2001 million. Its inventory turnover equals:

4.73.

82.0 days.

77.2 days.

4.50.

0.22.

QUESTION

1. Chou Co. has a net income of $49,000, assets at the beginning of the year are $256,000 and assets at the end of the year are $306,000. Compute its return on assets.

16.0%.

9.5%.

17.4%.

1.6%.

19.1%.

QUESTION

1. On July 1 of the current calendar year, Olive Co. paid $9200 cash for management services to be performed over a two-year period beginning July 1. Olive follows a policy of recording all prepaid expenses to asset accounts at the time of cash payment. The adjusting entry on December 31 of the current year for Olive would include:

A debit to a prepaid expense and a credit to an expense for $2300.

A debit to a prepaid expense and a credit to Cash for $6900.

A debit to an expense and a credit to a prepaid expense for $2300.

A credit to a liability and a debit to a prepaid expense for $2300.

A debit to an expense and a credit to a prepaid expense for $6900.