ACC 556 Week 3 Quiz | Assignment Help | Strayer University
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ACC 556 Week 3 Quiz | Assignment Help | Strayer University
Practice Question Paper (Part-1)
Practice Question 01
The operating
cycle of a merchandising company is ordinarily shorter than that of a service
company.
o
True
o
False
Practice Question 02
Which of the following is a merchandiser that sells
directly to consumers?
o
Customer
o
Retailer
o
Service enterprise
o
Wholesaler
Practice Question 03
Which is true about a wholesaler?
o
It sells to another business, which will
sell to a consuming customer.
o
It sells only to manufacturing
companies.
o
It conducts large sales for consumers on
a recurring basis.
o
It is a company that sells to consumers
at a discount.
Practice Question 04
Which of the
following statements about a periodic inventory system is true?
o
Companies determine cost of goods sold
only at the end of the accounting period.The increased use of computerized
systems has increased the use of the periodic system.
o
Companies continuously maintain detailed
records of the cost of each inventory purchase and sale.
o
The periodic system provides better
control over inventories than a perpetual system.
Practice Question 05
The operating
cycle of a merchandising company is ordinarily ___________________ that of a
service firm.
o
The same as
o
Has fewer steps than
o
Longer than
o
Shorter than
Practice Question 06
Which of the
following statements is correct?
o
A perpetual inventory system computes
cost of goods sold only at the end of the accounting period.
o
A perpetual inventory system provides
better control over inventories than does a periodic inventory system.
o
A periodic inventory system provides
better control over inventories than does a perpetual inventory system.
o
A periodic inventory system computes
cost of goods sold each time a sale occurs.
Practice Question 07
Which
inventory system will likely be used by a company with merchandise that has a
high unit value?
o
Double entry inventory system
o
Perpetual inventory system
o
Periodic inventory system
o
Single entry inventory system
Practice Question 08
Discount term
of 2/10, n/30 mean that a 10% cash discount is available if payment is made
within 30 days.
o
True
o
False
Practice Question 11
When credit
terms of 1/15, n/60 are offered, how long is the discount period?
o
45 days
o
15 days
o
60 days
o
1 day
Practice Question 13
Which of the following items does not result in an
entry to the Inventory account under a perpetual system?
o
A purchase of merchandise
o
Payment of freight costs for goods
shipped to a customer
o
A return of Inventory to the supplier
o
Payment of freight costs for goods
received from a supplier
Practice Question 12
Martin
Company purchases $4,200 of merchandise on March 1, with credit terms of 3/10,
n/30. If Martin pays on March 1, what is the cost of this purchase?
o
$4,074
o
$3,864
o
$3,780
o
$4,200
Practice Question 16
Marsh, Inc.
paid for freight costs on merchandise it shipped to a customer. In what account
will Marsh record this cost in a perpetual inventory system?
o
Inventory
o
Freight-in account
o
Freight-out account
o
Cost of goods sold account
Practice Question 18
Myers and
Company sold $1,800 of merchandise on account to Oscar, Inc. on March 1 with
credit terms of 2/10, n/30. Oscar returned $500 of the merchandise due to poor
quality on March 3. If Oscar pays for the purchase on March 11, what entry does
Myers make to record receipt of the payment?
Cash 1,764
Accounts Receivable 1,764
Cash 1,274
Sales Discount 26
Accounts Receivable 1,300
Cash 1,800
Sales Returns and Allowances 500
Accounts Receivable 1,300
Cash 1,800
Sales Discount 36
Accounts Receivable 1,764
Practice Question 17
On what
amount is a sales discount based?
o
Invoice less discount
o
Invoice price plus freight-in
o
Invoice price less returns and
allowances
o
Invoice price plus freight-out
Practice Question 22
Which of
these accounts normally have a debit balance?
o
Sales Discounts only
o
Sales Returns and Allowances only
o
Both Sales Discounts and Sales Returns
and Allowances
o
Neither Sales Discount nor Sales Returns
and Allowances
Practice Question 21
A retailer
makes a $100 sale with terms of 2/10, n/30 on the first of the month. The
customer returns $20 of merchandise for credit on account. What journal entry
will the retailer record when payment is received within the discount period
under a perpetual inventory system?
o
Cash 98.00
Sales Discounts 2.00
Accounts Receivable 100.00
o
Cash 78.40
Sales Discounts 1.60
Accounts
Receivable 80.00
o
Cash 78.40
Purchase Discounts 1.60
Accounts
Payable 80.00
o
Accounts Payable 80.00
Cash 78.40
Purchase
Discounts 1.60
Practice Question 20
Which
statement is true for the seller?
o
The Sales Discounts account is debited
for defective merchandise returned by a customer.The Sales Discounts account is
credited for defective merchandise returned by a customer.
o
The Sales Returns and Allowances account
is credited for defective merchandise returned by a customer.
o
The Sales Returns and Allowances account
is debited for defective merchandise returned by a customer.
Practice Question 25
Which one of
the following statements is correct?
o
A company which uses a perpetual
inventory system needs only one journal entry when it sells merchandise.
o
A company which uses a perpetual
inventory system needs two journal entries when it sells merchandise.
o
A company which uses a perpetual
inventory system debits inventory and credits cost of goods sold when it sells
merchandise.
o
None of the answer choices are correct.
Practice Question 26
What type of
accounts are Sales Returns and Allowances and Sales Discounts?
o
Contra expense accounts
o
Expense accounts
o
Contra asset accounts
o
Contra revenue accounts
Practice Question 27
Gross profit
is the difference between net sales and cost of goods sold.
o
True
o
False
Practice Question 32
Assume that
sales revenue are $450,000, sales discounts are $10,000, net income is $35,000,
and cost of goods sold is $320,000. How much are gross profit and operating
expenses, respectively?
o
$130,000 and $85,000
o
$120,000 and $85,000
o
$130,000 and $95,000
o
$120,000 and $95,000
Practice Question 31
Which of the
following is classified in an income statement as a non operating activity?
o
Returning merchandise
o
Receiving an allowance for merchandise
damaged in shipment
o
Paying for a purchase of inventory
o
Receiving dividend revenue from an
investment
Practice Question 33
Which of the
following would appear on both a single-step and a multiple-step income
statement?
o
Income from operations
o
Cost of goods sold
o
Other expenses and losses
o
Gross profit
Practice Question 34
Which one of
the following will result in gross profit?
o
Operating expenses less net income
o
Operating expenses less cost of goods
sold
o
Sales revenue less cost of goods sold
o
Sales revenue less operating expenses
Practice Question 35
If sales
revenues totals $400,000, cost of goods sold is $310,000, and operating
expenses are $60,000, how much is the gross profit?
o
$90,000
o
$340,000
o
$400,000
o
$30,000
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