S1 Gross profit represents the merchandising profit of a company.

S2 Gross profit is a measure of the overall profitability of a company.

a. First Statement is True; second statement is False.

b. Second statement is False; first Statement is True.

c. Both statements are True.

d. Both statements are False.

S1 Merchandise inventory is classified as a current asset in a classified balance sheet.

S2 Gain on sale of equipment and interest expense are reported under other revenues and gains in a multiple-step income statement.

a. First Statement is True; second statement is False.

b. Second statement is False; first Statement is True.

c. Both statements are True.

d. Both statements are False.

S1-When using the perpetual inventory system, the Merchandise Inventory account will not appear in closing entries.

S2-When using the perpetual inventory system, the Merchandise Inventory account will appear in closing entries.

Both statements are true

Both statements are false

One statement is true, the other statement is false

S1- Net Sales is not an account name.

S2 - Under the perpetual inventory system, the Ending Merchandise Inventory balance is closed at the same time as Cost of Goods Sold.

Both statements are true

Both statements are false

One statement is true, the other statement is false