ACCT 701 End of Chapter 6 Exam Questions and Answers
5 views 0 purchase
Course
FIN701
Institution
FIN701
To compute net sales, sales discounts are added to, and sales returns and allowances are deducted from, gross sales. (T/F) - Answer-F
Under perpetual inventory procedure, the Merchandise Inventory account is debited for each purchase and credited for each sale. (T/F) - Answer-T
Purchase disco...
ACCT 701 End of Chapter 6 Exam
Questions and Answers
To compute net sales, sales discounts are added to, and sales returns and allowances
are deducted from, gross sales. (T/F) - Answer-F
Under perpetual inventory procedure, the Merchandise Inventory account is debited for
each purchase and credited for each sale. (T/F) - Answer-T
Purchase discounts and purchase returns and allowances are recorded in contra
accounts to the Purchases account. (T/F) - Answer-T
In taking a physical inventory, consigned goods delivered to another party who attempts
to sell the goods are not included in the ending inventory of the company that sent the
goods. (T/F) - Answer-F
A classified income statement consists of only two categories of items, revenues and
expenses. (T/F) - Answer-F
A seller sold merchandise which has a list price of USD 4,000 on account, giving a trade
discount of 20 per cent. The entry on the books of the seller is:
a. Accounts Receivable 3,200
Trade Discounts 800
Sales 4,000
b. Accounts Receivable 4,000
Sales 4,000
c. Accounts Receivable 3,200
Trade Discounts 800
Sales 4,000
d. Accounts Receivable 3,200
Sales 3,200 - Answer-D
X Company began the accounting period with USD 60,000 of merchandise, and net
cost of purchases was USD 240,000. A physical inventory showed USD 72,000 of
merchandise unsold at the end of the period. The cost of goods sold of Y Company for
the period is:
a. USD 300,000.
b. USD 228,000.
c. USD 252,000.
d. USD 168,000.
e. None of the above. - Answer-B
The benefits of buying summaries with Stuvia:
Guaranteed quality through customer reviews
Stuvia customers have reviewed more than 700,000 summaries. This how you know that you are buying the best documents.
Quick and easy check-out
You can quickly pay through credit card or Stuvia-credit for the summaries. There is no membership needed.
Focus on what matters
Your fellow students write the study notes themselves, which is why the documents are always reliable and up-to-date. This ensures you quickly get to the core!
Frequently asked questions
What do I get when I buy this document?
You get a PDF, available immediately after your purchase. The purchased document is accessible anytime, anywhere and indefinitely through your profile.
Satisfaction guarantee: how does it work?
Our satisfaction guarantee ensures that you always find a study document that suits you well. You fill out a form, and our customer service team takes care of the rest.
Who am I buying these notes from?
Stuvia is a marketplace, so you are not buying this document from us, but from seller lectknancy. Stuvia facilitates payment to the seller.
Will I be stuck with a subscription?
No, you only buy these notes for $7.99. You're not tied to anything after your purchase.
