Hull Company reported the following income statement information for the current year:

Sales	$	412,000
Cost of goods sold:
Beginning inventory	$	135,000
Cost of goods purchased		275,000
Cost of goods available for sale		410,000
Ending inventory		146,000
Cost of goods sold		264,000
Gross profit	$	148,000

The beginning inventory balance is correct. However, the ending inventory figure was overstated by $22,000. Given this information, the correct gross profit would be:

Multiple Choice

• $126,000.

• $170,000.

• $113,000.

• $148,000.

• $139,000.

Q15. A companys inventory records report the following:

August 1	Beginning balance	21 units @ $11
August 5	Purchase	16 units @ $10
August 12	Purchase	20 units @ $11

On August 15, it sold 42 units. Using the FIFO perpetual inventory method, what is the value of the inventory at August 15 after the sale?

Multiple Choice

• $185

• $855

• $165

• $555

• $462

Q16. Using the retail inventory method, if the cost to retail ratio is 75% and ending inventory at retail is $161,000, then estimated ending inventory at cost is $223,143.

Group startsTrue or False

True, unselectedFalse, unselected

Q17. The following information is available for Birch Company at December 31:

Money market fund balance	$	2,800
Certificate of deposit maturing June 30 of next year	$	15,100
Postdated checks from customers	$	1,500
Cash in bank account	$	22,531
NSF checks from customers returned by bank	$	660
Cash in petty cash fund	$	210
Inventory of postage stamps	$	19
U.S. Treasury bill purchased on December 15 and maturing on February 28 of following year	$	10,100

Based on this information, Birch Company should report Cash and Cash Equivalents on December 31 of:

Multiple Choice

• $36,481

• $37,801

• $50,741

• $35,641

Q18. Cantrell Company is required by law to collect and remit sales taxes to the state. If Cantrell has $5,000 of cash sales that are subject to an 7% sales tax, what is the journal entry to record the cash sales?

Multiple Choice

• Debit Cash $5,000; credit Sales $4,650; credit Sales Taxes Payable $350.

• Debit Cash $5,350; credit Sales $5,000; credit Sales Taxes Payable $350.

• Debit Cash $5,000; credit Sales $5,000; and record the taxes when paid.

• Debit Accounts Receivable $5,350; credit Sales $5,000; credit Sales Taxes Payable $350.

• Debit Sales Taxes Payable $350; debit Cash $4,650; credit Sales $5,000.

Q19. Marquis Company uses a weighted-average perpetual inventory system and has the following purchases and sales:

August 2	19 units were purchased at $10 per unit.
August 18	24 units were purchased at $12 per unit.
August 29	21 units were sold.

What is the amount of the cost of goods sold for this sale? (Round average cost per unit to 2 decimal places.)

Multiple Choice

• $216.50

• $214.00

• $233.52

• $478.00

• $288.00

Q 20. It is generally not necessary for businesses to reconcile their checking accounts since banks keep accurate records and provide internal control support for cash.

Group startsTrue or False

True, unselectedFalse, unselected