Positive operating income will result if gross profit exceds A) costs of goods sold. B) salaries and wages expense. cost of goods sold plus operating expenses. D) operating expenses. 2. Which of the followingis not a limitation of internal controla A) Cost of establishing control procedures B) The human element. C) Collusion. D Tha sibeof he compauny. Sound Company just began business and made the following four inventory purchases in June June June 150 units 200 units 200 units 150 units $ 780 1,170 1,260 10 15 28 June A physical count of merchandise inventory on June 30 reveals that there are 210 units on hand. The inventory method which results in the highest gross profit for June is A) the FIFO method. B) the LIFO method. C) the average cost method. D) not determinable. 4. Which one of the following is not an objective of a system of internal controls? A) Safeguard company assets. B) Overstate liabilities in order to be conservative C) Enhance the accuracy and reliability of accounting records D) Reduce the risks of errors. 5. Turner Corporation returned $150 of goods originally purchased on credit from Morgan Industries. Using the periodic Inventory approach, Turner would record this transaction as A) Inventory 150 150 150 150 150 150 150 150 Accounts Payable Inventory Accounts Payable Purchase Returns and Allowances B) Accounts Payable C) Purchase Returns and Allowances D) Accounts Payable 6. The collection of a Se00 account beyond the 2 percent discount perio will result in a debit to Cash for $588. debit to Accounts Receivable for $600. debit to Cash for $600. debit to Sales Discounts for $12 A) B) C) D)