TRUE or FALSE / Multiple Choice

1. When you say debit, does it mean:

1. Increase
2. Decrease
3. Either inc/dec
4. Neither dec or inc

2. Is cost of goods sold and cost of sales the same? True or False
3. Is inventory and purchases fall on the same account? True or False
4. When you sell goods, will you credit an inventory and debit Cost of Sales? True or False
5. When you purchase goods will you debit an inventory? True or False
6. In periodic inventory system, what comes first:

a. cost of goods sold

b. ending inventory?

7. Based from #6 question, what will you do to get this?

a. count the inventory that remains

b. count the inventory sold

c. ask the staff who maintains the record keeping

d. guess how much remains

8. In perpetual inventory system, what comes first

a. cost of goods sold

b. ending inventory

9. Is purchase discount being deducted prior getting the total goods available for sale? True or false
10. Is separate entity principle support the concept that the business transaction and owners transaction should be accounted in the same books? True or False
11. Statement 1: Is posting comes first before Trial balance

Statement 2: Is Trial balance comes first before journalizing

a. Statement 1 Correct; Statement 2 Incorrect

b. Statement 2 Incorrect; Statement 2 Correct

c. Both Statement Correct

d. Both Statement Incorrect

12. Is allowance of doubtful account and Bad debt expense different? True or False
13. In depreciation, what account is accumulated depreciation?

a. Expense account

b. Asset account

c. Liability account

d. Contra asset account

14. Same as #13, how will you journalize?

a. debit Accum. Depreciation; credit Dep exp

b. credit Accumulated Depreciation; debit Dep. Exp

c. debit Accum. Depreciation; credit Accounts payable

d. credit accumulated expense; debit Depreciation payable

15. Is there an entry to make if you A company bought an equipment with the terms FOB Shipping point, Freight Collect?

a. Yes

b. No

Problem:

1. If you have end inventory of 10,000 and cost of goods sold of 15,000, no information for beg inventory and purchases, how much is total goods available for sale?

2. If you have a beg inventory 10,000; purchases of 2,000; end inventory of 5,000; purchase returns of 500, How much is cost of sales?
3. If you have TGAS of 100,000, Cost of Sales of 20,000 and beg inventory of 10,000; How much is purchases?
4. In the same given in #3 except beg inventory is missing, but the purchases is 20,000. How much is beginning Inventory?
5. If you have a sales of 1,000,000, and cost of sales which is 30% of sales, How much is Gross profit?