QUESTION 1

1. Under a double-entry system, show how the entry in each statement is entered in the ledger by using debit or credit to indicate the increase or decrease in the affected account An increase in Salaries and Wages Expense.
2. DebitCreditNone of the Above

1 points

QUESTION 2

1. Under a double-entry system, show how the entry in each statement is entered in the ledger by using debit or credit to indicate the increase or decrease in the affected account A decrease in Accounts Payable.
2. DebitCreditNone of the Above

1 points

QUESTION 3

1. Under a double-entry system, show how the entry in each statement is entered in the ledger by using debit or credit to indicate the increase or decrease in the affected account An increase in Prepaid Insurance.
2. DebitCreditNone of the Above

1 points

QUESTION 4

1. Under a double-entry system, show how the entry in each statement is entered in the ledger by using debit or credit to indicate the increase or decrease in the affected account An increase in Owner's Capital.
2. DebitCreditNone of the Above

1 points

QUESTION 5

1. Under a double-entry system, show how the entry in each statement is entered in the ledger by using debit or credit to indicate the increase or decrease in the affected account A decrease in Office Supplies.
2. DebitCreditNone of the Above

1 points

QUESTION 6

1. Under a double-entry system, show how the entry in each statement is entered in the ledger by using debit or credit to indicate the increase or decrease in the affected account An increase in Owner's Drawings.
2. DebitCreditNone of the Above

1 points

QUESTION 7

1. Under a double-entry system, show how the entry in each statement is entered in the ledger by using debit or credit to indicate the increase or decrease in the affected account An increase in Service Revenue.
2. DebitCreditNone of the Above

1 points

QUESTION 8

1. Under a double-entry system, show how the entry in each statement is entered in the ledger by using debit or credit to indicate the increase or decrease in the affected account A decrease in Accounts Receivable.
2. DebitCreditNone of the Above

1 points

QUESTION 9

1. Under a double-entry system, show how the entry in each statement is entered in the ledger by using debit or credit to indicate the increase or decrease in the affected account An increase in Rent Expense.
2. DebitCreditNone of the Above

1 points

QUESTION 10

1. Under a double-entry system, show how the entry in each statement is entered in the ledger by using debit or credit to indicate the increase or decrease in the affected account A decrease in Store Equipment.
2. DebitCreditNone of the Above

1 points

QUESTION 11

1. Retailers and wholesalers are both considered merchandisers.
2. TrueFalse

1 points

QUESTION 12

1. The steps in the accounting cycle are different for a merchandising company than for a service company.
2. TrueFalse

1 points

QUESTION 13

1. Sales minus operating expenses equals gross profit.
2. TrueFalse

1 points

QUESTION 14

1. Under a perpetual inventory system, the cost of goods sold is determined each time a sale occurs.
2. TrueFalse

1 points

QUESTION 15

1. A periodic inventory system requires a detailed inventory record of inventory items.
2. TrueFalse

1 points

QUESTION 16

1. Freight terms of FOB Destination means that the seller pays the freight costs.
2. TrueFalse

1 points

QUESTION 17

1. Freight costs incurred by the seller on outgoing merchandise are an operating expense to the seller.
2. TrueFalse

1 points

QUESTION 18

1. Sales revenues are earned during the period cash is collected from the buyer.
2. TrueFalse

1 points

QUESTION 19

1. The Sales Returns and Allowances account and the Sales Discount account are both classified as expense accounts.
2. TrueFalse

1 points

QUESTION 20

1. The revenue recognition principle applies to merchandisers by recognizing sales revenues when they are earned.
2. TrueFalse

1 points

QUESTION 21

1. Sales Allowances and Sales Discounts are both designed to encourage customers to pay their accounts promptly.
2. TrueFalse

1 points

QUESTION 22

1. To grant a customer a sales return, the seller credits Sales Returns and Allowances.
2. TrueFalse

1 points

QUESTION 23

1. A company's unadjusted balance in Merchandise Inventory will usually not agree with the actual amount of inventory on hand at year-end.
2. TrueFalse

1 points

QUESTION 24

For a merchandising company, all accounts that affect the determination of income are closed to the Income Summary account.

TrueFalse

1 points

QUESTION 25

A merchandising company has different types of adjusting entries than a service company.

TrueFalse

1 points

QUESTION 26

Nonoperating activities exclude revenues and expenses that result from secondary or auxiliary operations.

TrueFalse

1 points

QUESTION 27

Selling expenses relate to general operating activities such as personnel management.

TrueFalse

1 points

QUESTION 28

Net sales appears on both the multiple-step and single-step forms of an income statement.

TrueFalse

1 points

QUESTION 29

A multiple-step income statement provides users with more information about a company's income performance.

TrueFalse

1 points

QUESTION 30

1. The multiple-step form of the income statement is easier to read than the single-step form.
2. TrueFalse