QUESTION 1

1. AG Inc. made a $10,000 sale on account with the following terms: 1/15, n/30. If the company uses the net method to record sales made on credit, how much should be recorded as revenue?
2. a.$9,800.
3. b.$9,900.
4. c.$10,000.
5. d.$10,100.

10 points

QUESTION 2

1. During the year, Kiner Company made an entry to write off a $4,000 uncollectible account.Before this entry was made, the balance in accounts receivable was $50,000 and the balance in the allowance account was $4,500. The net realizable value of accounts receivable after the write-off entry was
2. a.$50,000.
3. b.$49,500.
4. c.$41,500.
5. d.$45,500.

10 points

QUESTION 3

1. Smithson Corporation had a 1/1/10 balance in the Allowance for Doubtful Accounts of $10,000. During 2010, it wrote off $7,200 of accounts and collected $2,100 on accounts previously written off. The balance in Accounts Receivable was $200,000 at 1/1 and $240,000 at 12/31. At 12/31/10, Smithson estimates that 5% of accounts receivable will prove to be uncollectible. What is Bad Debt Expense for 2010?
2. a.$2,000.
3. b.$7,100.
4. c.$9,200.
5. d.$12,000.

10 points

QUESTION 4

1. AG Inc. made a $10,000 sale on account with the following terms: 2/10, n/30. If the company uses the net method to record sales made on credit, what is/are the debit(s) in the journal entry to record the sale?
2. a.Debit Accounts Receivable for $9,800.
3. b.Debit Accounts Receivable for $9,800 and Sales Discounts for $200.
4. c.Debit Accounts Receivable for $10,000.
5. d.Debit Accounts Receivable for $10,000 and Sales Discounts for $200.

10 points

QUESTION 5

1. Lexington Company sells product 1976NLC for $40 per unit. The cost of one unit of 1976NLC is $36, and the replacement cost is $34. The estimated cost to dispose of a unit is $8, and the normal profit is 40%. At what amount per unit should product 1976NLC be reported, applying lower-of-cost-or-market?
2. a.$16.
3. b.$32.
4. c.$34.
5. d.$36.

10 points

QUESTION 6

1. Turner Corporation acquired two inventory items at a lump-sum cost of $50,000. The acquisition included 3,000 units of product LF, and 7,000 units of product 1B. LF normally sells for $15 per unit, and 1B for $5 per unit. If Turner sells 1,000 units of LF, what amount of gross profit should it recognize?
2. a.$1,875
3. b.$5,625.
4. c.$10,000.
5. d.$11,875.

10 points

QUESTION 7

1. Robust Inc. has the following information related to an item in its ending inventory. Acer Top has a cost of $502, a replacement cost of $468, a net realizable value of $531, and a normal profit margin of $68. What is the final lower-of-cost-or-market inventory value for Acer Top?
2. a.$463.
3. b.$502.
4. c.$468.
5. d.$531.

10 points

QUESTION 8

1. Muckenthaler Company sells product 2005WSC for $20 per unit. The cost of one unit of 2005WSC is $18, and the replacement cost is $17. The estimated cost to dispose of a unit is $4, and the normal profit is 40%. At what amount per unit should product 2005WSC be reported, applying lower-of-cost-or-market?
2. a.$8.
3. b.$16.
4. c.$17.
5. d.$18.

10 points

QUESTION 9

1. A Company manufactures computers. The company attempts to obtain a 10% gross margin on selling price. At December 31, 2010, the following computer appears in the company's inventory:
3. Computer ABC
4. Inventorycost800
5. Estimated cost to manufacture600
6. Commissions and disposal costs 100
7. Catalog sellingprice890
9. After computing LCM, inventory needs to be adjusted by :
10. 0
11. 99
12. 701
13. 790