AB 113 Unit 5 Exam (Kaplan)
- Smith Co. sold merchandise to Bronze Co. on account, $25,000, terms 2/15, net 45. The cost of the merchandise sold is $18,500. Smith Co. issued a credit memorandum for $2,500 for merchandise returned that originally cost $1,900. Bronze Co. paid the invoice within the discount period. What is amount of net sales from the transactions?
- Multiple-step income statements show:
- West, Inc. had beginning inventory of $5,000, purchases of $35,000, and ending inventory of $10,000. What is West’s cost of merchandise sold?
- Philip Corporation purchased equipment by taking out a loan. What is the effect of this transaction?
- Adjustments are made prior to financial statement preparation under which method of accounting?
- What types of accounts are listed in the balance sheet?
- Inventory NOT sold at the end of the period is reported as
- ___________ is an example of a deferred expense.
- X&M Co. provided services of $2,000,000 to clients on account. How does this transaction affect A&M's accounts?
- Which of the following group of accounts are all assets?
- Which accounts are found on the income statement?
- What is the purpose of accrual accounting?
- XYZ Company had $42,000 in net sales, $25,000 in cost of merchandise sold, $28,000 in operating expenses, and $3,000 in other income. What is XYZ Company’s gross profit?
- Generally, the revenue account for a merchandising business is entitled:
- Which of the following situations increase stockholders’ equity?
Sally, Inc. had the following merchandise transactions in October:
What is the total cost of merchandise purchased for Sally, Inc.?
- The accounting equation is the basis for analyzing, summarizing, and recording transactions in accounting. The accounting equation is:
- Accrual accounting records revenue when:
- Deferred revenues (unearned revenues) are items initially recorded as liabilities, but expected to become _____ over time.
- When preparing an adjustment under accrual accounting, what would be the proper amount of the adjusting entry if the end of the period balance in the supply account is $4,000 and the amount of supplies on hand is $1650?
- Which of the following best describes an accrual adjustment? (L3)
- A __________ is an economic event that under generally accepted accounting principles affects an element of the financial statements and must be recorded.
- When merchandise is purchased to resell to customers, it is recorded in the account entitled:
- The payment of a liability
- When purchases of merchandise are made for cash, the transaction