Accounting For Merchandising quiz

Financial Accounting Quiz

On Aug 20, 2024

/10

Accounting For Merchandising

10 questions in 10 minutes

Pass Score 70%

1 / 10

In a worksheet using a perpetual inventory system, Inventory is shown in the following columns :

adjusted trial balance debit and balance sheet debit

income statement debit and balance sheet debit

income statement credit and adjusted trial balance debit

income statement credit and balance sheet debit

2 / 10

Which of the following accounts will normally appear in the ledger of a merchandising company that uses a perpetual inventory system ?

Cost of Goods Sold

Purchases

Purchase Discounts

Freight-In

3 / 10

A single step income statement :

reports gross proft

reports sales revenues and “Other revenues and gains” in the revenues section of the income statement

does not report cost of goods sold

reports operating income separately

4 / 10

Under a perpetual inventory system, when goods are purchased for resale by a company :

purchase returns are debited to Purchase Returns and Allowances

freight costs are debited to Freight Out

purchases on account are debited to Purchases

purchases on account are debited to Inventory

5 / 10

The steps in the accounting cycle for a merchandising company are the same as those in a service company except :

a multiple-step income statement is required for a merchandising company

closing journal entries are not required for a merchandising company

a post-closing trial balance is not required for a merchandising company

an additional adjusting journal entry for inventory may be needed in a merchandising company

6 / 10

To record the sale of goods for cash in a perpetual inventory system :

two journal entries are necessary: one to record the receipt of cash and sales revenue, and one to record the cost of goods sold and reduction of inventory

only one journal entry is necessary to record the receipt of cash and the sales revenue

two journal entries are necessary: one to record the receipt of cash and reduction of inventory, and one to record the cost of goods sold and sales revenue

only one journal entry is necessary to record cost of goods sold and reduction of inventory

7 / 10

When goods are purchased for resale by a company using a periodic inventory system :

purchases on account are debited to Purchases

purchase returns are debited to Purchase Returns and Allowances

purchases on account are debited to Inventory

freight costs are debited to Purchases

8 / 10

In determining cost of goods sold in a periodic system :

purchase discounts are deducted from net purchases

freight-in is added to net purchases

purchase returns and allowances are deducted from net purchases

freight-out is added to net purchases

9 / 10

Which of the following appears on both a single-step and a multiple-step income statement ?

Gross proft

Income from operations

Cost of goods sold

Inventory

10 / 10

If sales revenues are $500,000, cost of goods sold is $400,000, and operating expenses are $50,000, the gross proft is :

$100,000

$450,000

$500,000

$50,000

Your score is

Question topics

perpetual and periodic inventory systems

Purchase returns and allowances – Purchase discounts – Freight costs

Multiple step income statement * Single step income statement