1. Question 1Merchandise inventory accounting systems can be broadly categorized into two types. They are __________.
2. FIFO and LIFO
3. perpetual and periodic
4. wholesale and retail
5. manufacturer and producer

5 points

Question 2

1. Changing from the LIFO (Last-In, First-Out) to the specific identification method of valuing inventory ignores the principle of __________.
2. conservatism
3. consistency
4. disclosure
5. materiality

5 points

Question 3

1. Which of the following statements is FALSE?
2. In a perpetual inventory system, the "cash register" at the store is a computer terminal that records sales and updates inventory records.
3. Even in a perpetual inventory system, a business must count inventory at least one a year.
4. Restaurants and small retail stores often use the periodic inventory system.
5. In a periodic inventory system, merchandise inventory and purchasing systems are integrated with the records for Accounts Receivable and Sales Revenue.

5 points

Question 4

1. Which of the following is subtracted from net sales revenue to arrive at gross profit on a multi-step income statement?
2. Cost of goods available for sale
4. Cost of goods sold
6. Sales discounts and sales returns and allowances
7. Operating expenses

5 points

Question 5

1. A company that uses the perpetual inventory system purchases inventory for $61,000 on account, with terms of 3/10, n/30. Which of the following is the journal entry to record the payment made within 10 days?
2. A debit to Accounts Payable for $61,000, a credit to Cash for $59,170, and a debit to Merchandise Inventory for $1,830
3. A debit to Accounts Payable for $61,000, a credit to Merchandise Inventory for $1,830, and a credit to Cash for $59,170
4. A debit to Merchandise Inventory for $1,830, a debit to Accounts Payable for $61,000, and a credit to Cash for $62,830
5. A debit to Accounts Payable for $59,170, a debit to Merchandise Inventory for $1,830, and a credit to Cash for $61,000

5 points

Question 6

1. What does "2/10" mean, with respect to "credit terms of 2/10, n/30"?
2. A discount of 2 percent will be allowed if the invoice is paid within 10 days of the invoice date.
3. Interest of 2 percent will be charged if the invoice is paid after 10 days from the date on the invoice.
4. A discount of 10 percent will be allowed if the invoice is paid within two days of the invoice date.
5. Interest of 10 percent will be charged if invoice is paid after two days.

5 points

Question 7

1. Which of the following is true of freight in?
2. It is an administrative expense.
3. It is a selling expense.
4. It is the transportation cost on purchases.
5. It is the transportation cost on sales.

5 points

Question 8

1. Which of the following is not recorded in a modern perpetual inventory system?
2. Units purchased and cost amount
3. Units sold and sales and cost amounts
4. Customer account numbers and balances owed from the sale of merchandise inventory
5. The quantity of merchandise inventory on hand and its cost

5 points

Question 9

1. If goods are sold on terms free on board (FOB) shipping point, the __________.
2. seller normally pays the transportation costs
3. buyer normally pays the transportation costs
4. buyer and the seller split the transportation costs
5. shipping company bears the transportation cost

5 points

Question 10

1. A company decides to ignore a very small error in its inventory balance. This is an example of the application of the __________.
2. conservatism
3. materiality concept
4. disclosure principle
5. consistency principle

5 points

Question 11

1. Misty, Inc. had 24,000 units of ending inventory that were recorded at the cost of $8.00 per unit using the FIFO method. The current replacement cost is $4.50 per unit. Which of the following amounts would be reported as Ending Merchandise Inventory on the balance sheet using the lower-of-cost-or-market rule?
2. $192,000
3. $300,000
4. $216,000
5. $108,000

5 points

Question 12

1. Which of the following is the correct formula to calculate inventory turnover?
2. Inventory turnover = Cost of goods sold / Average merchandise inventory
3. Inventory turnover = Cost of goods sold Average merchandise inventory
4. Inventory turnover = Cost of goods sold + Average merchandise inventory
5. Inventory turnover = Cost of goods sold - Average merchandise inventory

5 points

Question 13

1. Blanchard, Inc. provided the following for 2017:
3. Cost of GoodsSold (Cost of sales)$1,200,000Beginning Merchandise Inventory325,000Ending Merchandise Inventory625,000
5. Calculate the company's inventory turnover ratio for the year. (Round your answer to two decimal places.)
6. 3.69 times per year
7. 2.53 times per year
8. 1.92 times per year
9. 1.26 times per year

5 points

Question 14

1. A company that uses the perpetual inventory system purchased 500 pallets of industrial soap for $10,000 and paid $750 for the freight-in. The company sold the whole lot to a supermarket chain for $14,000 on account. The company uses the specific-identification method of inventory costing. Which of the following entries correctly records the cost of goods sold?
2. Cost of Goods Sold10,750Merchandise Inventory10,750
3. MerchandiseInventory10,750Cost of Goods Sold10,750
4. Cost of Goods Sold10,000Sales Revenue10,000
5. Cost of Goods Sold10,000Merchandise Inventory10,000

5 points

Question 15

1. Under the weighted-average method for inventory costing, the cost per unit is determined by __________.
2. dividing the cost of goods available for sale by the number of units available
3. dividing the cost of goods available for sale by the number of units in beginning inventory
4. multiplying the number of units purchased with the weighted-average cost
5. multiplying the cost of goods available for sale by the ending weighted-average cost of the previous accounting period

5 points

Question 16

1. A company that uses the perpetual inventory system sold goods to a customer on account for $4,000. The cost of the goods sold was $2,000. Which of the following journal entries correctly records this transaction?
2. Cost of Goods Sold4,000Sales Revenue4,000
3. MerchandiseInventory4,000Costs of Goods Sold4,000
4. AccountsReceivable4,000Cash4,000
5. Cost of Goods Sold2,000Merchandise Inventory2,000
6. AccountsReceivable4,000Sales Revenue4,000
7. Cost of Goods Sold2,000Merchandise Inventory2,000

5 points

Question 17

1. The ending merchandise inventory for the current year is overstated by $25,000. What effect will this error have on the following year's net income?
2. The net income will be overstated by $50,000.
3. The net income will be overstated by $25,000.
4. The net income will be understated by $25,000.
5. The net income will be understated by $50,000.

5 points

Question 18

1. A company purchased 100 units for $30 each on January 31. It purchased 400 units for $20 each on February 28. It sold a total of 470 units for $110 each from March 1 through December 31. If the company uses the last-in, first-out inventory costing method, calculate the amount of ending inventory on December 31. (Assume that the company uses a perpetual inventory system.)
2. $600
3. $2,400
4. $900
5. $30

5 points

Question 19

1. A company that uses the perpetual inventory system sold goods for $2,500 to a customer on account. The company had purchased the inventory for $500. Which of the following journal entries correctly records the cost of goods sold?
2. Cost of Goods Sold500Sales Revenue500
3. MerchandiseInventory500Cost of Goods Sold500
4. Cost of Goods Sold500Merchandise Inventory500
5. AccountsReceivable500Sales Revenue500

5 points

Question 20

1. Which of the following principles states that a business's financial statements must report enough information for outsiders to make knowledgeable decisions about the company?
2. conservatism
3. materiality concept
4. disclosure principle
5. consistency principle

Thanks for the help