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Accounting-201 1. Under a perpetual inventory system part of the merchandise purchased on account at an earlier time is now being returned. None of the goods have been paid for. The correct journal entry for this return will be a: (a) debit to Cash and a credit to purchases (b) debit to Merchandise inventory and a credit to Accounts payable (c) debit to Accounts payable and a credit to Merchandise inventory (d) debit to purchases returns and a credit to cost of Goods Sold 2. Gross profit is the difference between: (a) net sales and operating expenses (b) net sales and the cost of goods sold (c) net sales and the cost of goods sold plus all the expenses (d) gross sales less the sales discounts and sales returns and allowances 3. The records for uptown Cake shop showed the following: Sales $75,000; Beginning merchandise inventory $10,000; purchases $45,000; Ending Merchandise Inventory $50,000. The Cost of Goods Sold must have been- (a) $10,000 (b) $5000 (c) $15000 (d) $25000 4. If the terms of trade include FOB Destination, who pays for the freight cost? (a) Buyer (b) Seller

Accounting-201 1. Under a perpetual inventory system part of the merchandise purchased on account at an earlier time is now being returned. None of the goods have been paid for. The correct journal entry for this return will be a: (a) debit to Cash and a credit to purchases (b) debit to Merchandise inventory and a credit to Accounts payable (c) debit to Accounts payable and a credit to Merchandise inventory (d) debit to purchases returns and a credit to cost of Goods Sold 2. Gross profit is the difference between: (a) net sales and operating expenses (b) net sales and the cost of goods sold (c) net sales and the cost of goods sold plus all the expenses (d) gross sales less the sales discounts and sales returns and allowances 3. The records for uptown Cake shop showed the following: Sales $75,000; Beginning merchandise inventory $10,000; purchases $45,000; Ending Merchandise Inventory $50,000. The Cost of Goods Sold must have been- (a) $10,000 (b) $5000 (c) $15000 (d) $25000 4. If the terms of trade include FOB Destination, who pays for the freight cost? (a) Buyer (b) Seller

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Accounting-201 1. Under a perpetual inventory system part of the merchandise purchased on account at an earlier time is now being returned. None of the goods have been paid for. The correct journal entry for this return will be a: (a) debit to Cash and a credit to purchases (b) debit to Merchandise inventory and a credit to Accounts payable (c) debit to Accounts payable and a credit to Merchandise inventory (d) debit to purchases returns and a credit to cost of Goods Sold 2. Gross profit is the difference between: (a) net sales and operating expenses (b) net sales and the cost of goods sold (c) net sales and the cost of goods sold plus all the expenses (d) gross sales less the sales discounts and sales returns and allowances 3. The records for uptown Cake shop showed the following: Sales $75,000; Beginning merchandise inventory $10,000; purchases $45,000; Ending Merchandise Inventory $50,000. The Cost of Goods Sold must have been- (a) $10,000 (b) $5000 (c) $15000 (d) $25000 4. If the terms of trade include FOB Destination, who pays for the freight cost? (a) Buyer (b) Seller
Transcribed Image Text:Accounting-201 1. Under a perpetual inventory system part of the merchandise purchased on account at an earlier time is now being returned. None of the goods have been paid for. The correct journal entry for this return will be a: (a) debit to Cash and a credit to purchases (b) debit to Merchandise inventory and a credit to Accounts payable (c) debit to Accounts payable and a credit to Merchandise inventory (d) debit to purchases returns and a credit to cost of Goods Sold 2. Gross profit is the difference between: (a) net sales and operating expenses (b) net sales and the cost of goods sold (c) net sales and the cost of goods sold plus all the expenses (d) gross sales less the sales discounts and sales returns and allowances 3. The records for uptown Cake shop showed the following: Sales $75,000; Beginning merchandise inventory $10,000; purchases $45,000; Ending Merchandise Inventory $50,000. The Cost of Goods Sold must have been- (a) $10,000 (b) $5000 (c) $15000 (d) $25000 4. If the terms of trade include FOB Destination, who pays for the freight cost? (a) Buyer (b) Seller
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