In this Part of the midterm, there are 18 questions, worth a total of 22 points. You must answer all of them. When entering a numeric answer, just the digits -no dollar signs, commas, or decimal points. Be sure to select all the correct answers some questions have more than one. It will probably help if you fill out an accounting chart, using the expanded accounting equation, to keep track of the accounts whose balances have to be calculated. It will also help to keep track of the various companies named in the questions!

Bedrock Wholesale (BW)s first months transactions are given below. Answer the question that follows each one.

October 1 Purchased inventory from Fred Inc. for $25,000, FOB destination, terms 2/10 N/30. How will BW record the October 1 transaction? (1 point)

increase both Accounts Payable and Inventory Expense

increase both Accounts payable and Purchases

increase both Purchases and Inventory Expense

increase both Accounts Payable and Inventory

increase both Purchases and Inventory

October 2 The appropriate company paid $100 freight on the October 1 purchase. How will BW record the October 2 transaction? (1 point)

no entry required

increase both Freight Expense and Accounts Payable

increase both Inventory and Accounts Payable

increase both Inventory and Freight Expense

increase Freight Expense and decrease Cash

October 6 Returned $3,000 worth of goods to Fred, as they were the wrong colour. How will BW record the October 3 transaction? (1 point)

decrease Accounts Payable and increase Purchase Returns

decrease both Accounts Payable and inventory

decrease both Purchases and Inventory Expense

decrease both Accounts Payable and Inventory Expense

decrease Inventory and increase Purchase Returns

October 7 Sold half of the remaining inventory that was purchased from Fred, to Wilma Inc. for $16,000, FOB destination, terms 2/20 N/30. How will BW record the October 7 transaction? (1 point)

increase Cost of Goods Sold and decrease Inventory by $11,000 each

Increase Sales and Accounts Receivable by $16,000 each, and increase Cost of Goods Sold and decrease Inventory by $11,000 each

Increase Sales and Accounts Receivable by $16,000 each, and increase Cost of Goods Sold and decrease Inventory by $16,000 each

Increase Sales and Accounts Receivable by $16,000 each

Increase Sales and Accounts Receivable by $11,000 each, and increase Cost of Goods Sold and decrease Inventory by $16,000 each

October 8 The appropriate company paid $450 freight on the October 7 sale. How will BW record the October 8 transaction? (1 point)

increase both Accounts Payable and Freight Expense

increase both Accounts Payable and Cost of Goods Sold

decrease Cash and increase Freight Expense

decrease both Cash and Inventory

no entry required

October 10 Paid Fred the entire amount owed to him. In which accounts will BW record the October 10 transaction? (1 point)

decrease Cash and increase both Inventory and Accounts Payable

decrease Cash and Accounts payable only

decrease Cash, Inventory, and Accounts Payable

decrease Cash and Accounts Payable, and increase Inventory

decrease Cash and Inventory, and increase Accounts payable

How much does BW pay Fred on October 10? (2 points)

Answer

October 12 - Purchased inventory worth $15,000 from Barney Inc., FOB shipping point, terms 3/15 N/45. How will BW record the October 12 transaction? (1 point)

increase both Purchases and Inventory Expense

increase both Accounts Payable and Inventory

increase both Accounts Payable and Purchases

increase both Purchases and Inventory

increase both Accounts Payable and Inventory Expense

October 13 - The appropriate company paid $225 freight on the October 12 purchase. How will BW record the October 13 transaction? (1 point)

increase both Inventory and Freight Expense

increase both Inventory and Accounts Payable

increase Inventory and decrease Cash

increase Freight Expense and decrease Cash

no entry required

increase both Freight Expense and Accounts Payable

October 17 - Sold half of the inventory purchased from Barney to Betty Ltd. for $10,000, FOB shipping point, terms 1/10 N/20. How will BW record the October 17 transaction? (1 point)

increase Cost of Goods Sold and decrease Inventory by $7,500 each

Increase Sales and Accounts Receivable by $10,000 each, and increase Cost of Goods Sold and decrease Inventory by $10,000 each

Increase Sales and Accounts Receivable by $10,000 each

Increase Sales and Accounts Receivable by $10,000 each, and increase Cost of Goods Sold and decrease Inventory by $7,500 each

Increase Sales and Accounts Receivable by $7,500 each, and increase Cost of Goods Sold and decrease Inventory by $10,000 each

October 18 The appropriate company paid $80 freight on the October 17 sale. How will BW record the October 18 transaction? (1 point)

decrease both Cash and Inventory

increase both Accounts Payable and Cost of Goods Sold

increase both Accounts Payable and Freight Expense

decrease Cash and increase Freight Expense

no entry required

October 22 - Betty returned $3,000 worth of the goods she bought on October 17, as you shipped her the wrong size. How will BW record the October 22 transaction? (1 point)

Decrease Accounts Receivable and increase Sales Returns by $3,000 each

Increase Inventory and decrease Cost of Goods Sold by $3,000 each, and decrease Accounts Receivable and increase Sales Returns by $3,000 each

Increase Inventory and decrease Cost of Goods Sold by $2,250 each, and decrease Accounts Receivable and increase Sales Returns by $2,250 each

Increase Inventory and decrease Cost of Goods Sold by $2,250 each

Increase Inventory and decrease Cost of Goods Sold by $2,250 each, and decrease Accounts Receivable and increase Sales Returns by $3,000 each

October 25 Betty paid her outstanding balance. In which accounts will BW record the October 25 transaction? (1 point)

Increase Cash and decrease Accounts Receivable only

Increase Cash and Sales Discounts (reducing net sales), and decrease Accounts Receivable

Increase Cash and decrease both Sales and Accounts Receivable

Increase both Cash and Sales, and decrease Accounts Receivable

Increase Cash and decrease Sales Discounts (increasing net sales), and decrease Accounts Receivable

How much does Betty pay BW on October 25? (2 points)

Answer

October 30 Wilma paid her outstanding balance. In which accounts will BW record the October 30 transaction? (1 point)

Increase Cash and decrease both Sales and Accounts Receivable

Increase both Cash and Sales, and decrease Accounts Receivable

Increase Cash and decrease Accounts Receivable only

Increase Cash and decrease both Sales and Accounts Receivable

Increase both Cash and Sales, and decrease Accounts Receivable

How much does Wilma pay BW on October 30? (2 points)

Answer

October 31 Paid Barney the entire amount owed to him. In which accounts will BW record the October 30 transaction? (1 point)

Decrease Cash and increase both Inventory and Accounts Payable

Decrease Cash and Accounts Payable, and increase Inventory

Decrease Cash and Inventory, and increase Accounts Payable

Decrease Cash and Accounts Payable only

Decrease Cash, Inventory, and Accounts Payable

How much does BW pay Barney on October 31? (2 points)

Answer