What the answers
21) 21) When a company uses the perpetual inventory system B) the Merchandise Inventory account is debited for purchases of goods that the company C) the purchase of merchandise inventory on account is recorded as a debit to Accounts Payable D) A) the Merchandise Inventory account is reported as an expense on the income statement intends to resell to customers. and a credit to Merchandise Inventory purchases of Office Supplies and Equipment that will be used in the day-to-day operations of the business are recorded as debits to Merchandise Inventory. 22) A company that uses the perpetual inventory system purchases inventory for $64,000 on account, 22) with terms of 2/10, n/30. Which of the following is the journal entry to record the payment made A) a debit to Accounts Payable for $64,000, a credit to Merchandise Inventory for $1280, and a B) a debit to Accounts Payable for $62,720, a debit to Merchandise Inventory for $1280, and a C) a debit to Accounts Payable for $64,000, a credit to Cash for $1280, and a credit to D) a debit to Merchandise Inventory for $1280, a debit to Accounts Payable for $64,000, and a 10 days? credit to Cash for $62,720 credit to Cash for $64,000 Merchandise Inventory for $62,720 credit to Cash for $65,280 23) The terms of an invoice are 3/10, n/25. This means that aof the invoice date. 23) A) discount of 3 percent is allowed if the invoice is paid within 10 days after the invoice date B) discount of 10 percent is allowed if the invoice is paid within three days after the invoice date C) discount of 25 percent is allowed if the invoice is paid within 10 days after the invoice date D) discount of 3 percent is allowed if the invoice is paid after 25 days after the invoice date 4) An invoice, with payment terms of 5/10, n/30, was issued on April 28 for $250.00. If the payment 24) on May 12, the amount of payment will be Round your answer to the nearest cent.) A) $225.00 B) $237.50 C) $245.00 D) $250.00 ) Under the perpetual inventory system, when a wholesaler returns the goods purchased on account, 25 the account is credited A) Accounts Receivable C) Merchandise Inventory B) Cost of Goods Sold D) Accounts Payable If goods are sold on terms FOB shipping point, the 26) A) buyer normally pays the transportation costs B) buyer and the seller split the transportation costs C) seller normally pays the transportation costs D) shipping company bears the transportation cost Regarding the Cost of Goods Sold account, which of the following statements is incorrect? 27) A) Cost of Goods Sold is based on the company's cost, not the retail price. B) Cost of Goods Sold represents the cost of inventory that has been sold to customers C) Cost of Goods sold is a contra revenue account D) In a perpetual inventory system, the Cost of Goods Sold account keeps a current balance throughout the period
