Income from operations is gross profit less

a$.$ administrative expenses.

b$.$ operating expenses.

c$.$ other expenses and losses.

d$.$ selling expenses.

Two categories of expenses for merchandising companies are

a$.$ cost of goods sold and financing expenses.

b$.$ operating expenses and financing expenses.

c$.$ cost of goods sold and operating expenses.

d$.$ sales and cost of goods sold.

Which of the following is a true statement about inventory systems?

a$.$ Periodic inventory systems require more detailed inventory records.

b$.$ Perpetual inventory systems require more detailed inventory records.

c$.$ A periodic system requires cost of goods sold be determined after each sale.

d$.$ A perpetual system determines cost of goods sold only at the end of the accounting period.

Flynn Company purchased merchandise inventory with an invoice price of $$5,000$ and credit terms of $2/10,$ n$/30.$ What is the net cost of the goods if Flynn Company pays within the discount period?

a$.$ $$5,000$

b$.$ $$4,900$

c$.$ $$4,500$

d$.$ $$4,600$

Jake$$s Market recorded the following events involving a recent purchase of merchandise:

Received goods for $$20,000,$ terms $2/10,$ n$/30.$

Returned $$400$ of the shipment for credit.

Paid $$100$ freight on the shipment.

Paid the invoice within the discount period.

As a result of these events, the company$$s merchandise inventory

a$.$ increased by $$19,208.$

b$.$ increased by $$19,700.$

c$.$ increased by $$19,306.$

d$.$ increased by $$19,308.$

Holt Company sells merchandise on account for $$2,000$ to Jones Company with credit terms of $2/10,$ n$/30.$ Jones Company returns $$400$ of merchandise that was damaged, along with a check to settle the account within the discount period. What is the amount of the check?

a$.$ $$1,960$

b$.$ $$1,968$

c$.$ $$1,600$

d$.$ $$1,568$

The Sales Returns and Allowances account is classified as a$($n$)$

a$.$ asset account.

b$.$ contra asset account.

c$.$ expense account.

d$.$ contra revenue account.

Thelman Company reported the following balances at June $30,2008$:

Sales $$10,800$

Sales Returns and Allowances $400$

Sales Discounts $200$

Cost of Goods Sold $5,000$

Net sales for the month is

a$.$ $$10,800.$

b$.$ $$10,400.$

c$.$ $$10,200.$

d$.$ $$5,200.$

Use the following information for questions $1921.$

During $2008,$ Salon Enterprises generated revenues of $$60,000.$ The company$$s expenses were as follows: cost of goods sold of $$30,000,$ operating expenses of $$12,000$ and a loss on the sale of equipment of $$2,000.$

Salon$$s gross profit is

a$.$ $$60,000.$

b$.$ $$30,000.$

c$.$ $$18,000.$

d$.$ $$16,000.$

Salon$$s income from operations is

a$.$ $$60,000.$

b$.$ $$30,000.$

c$.$ $$18,000.$

d$.$ $$12,000.$

Salon$$s net income is

a$.$ $$60,000.$

b$.$ $$30,000.$

c$.$ $$18,000.$

d$.$ $$16,000.$