Question
Taha Company purchased $8,000 of inventory under terms FOB shipping point . Freight cost amounted to $200. The cost of inventory and freight were paid
Taha Company purchased $8,000 of inventory under terms FOB shipping point. Freight cost amounted to $200. The cost of inventory and freight were paid with cash. Which of the following shows how the recognition of this purchase, including freight costs if applicable, will affect the Company's financial statements?
| Balance Sheet | Income Statement | Statement of Cash Flows | |||||||||||
| Assets | = | ||||||||||||
| Cash | + | Inventory | = | Liab. | + | Equity | Rev. | - | Exp. | = | Net Inc. | ||
| A. | (8,000) | + | 8,000 | = | NA | + | NA | NA | - | NA | = | NA | NA |
| B. | (8,200) | + | 8,200 | = | NA | + | NA | NA | - | $8,200 | = | (8,200) | NA |
| C. | (8,200) | + | 8,200 | = | NA | + | NA | NA | - | NA | = | NA | (8,200) OA |
| D. | (8,000) | + | 8,000 | = | NA | + | NA | NA | - | 200 | = | (200) | (8,200) OA |
Multiple Choice
Option A
Option B
Option C
Option D
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The ISO 14000 EMS Audit Handbook
Authors: Greg Johnson
1st Edition
1574440691, 978-1574440690
