Accounting I GRADE A Q&A
The records for Uptown Pet Shop showed the following: Sales $225,000 Beginning
merchandise inventory $30,000 Purchases 135,000 Cost of goods sold 150,000. What
was the ending merchandise inventory? - (correct answer)$15,000
Because Cost of goods sold 150,000
-Purchases 135,000
=$15,000
Under a perpetual inventory system merchandise is purchased for cash. Which is the
correct journal entry to record this purchase? - (correct answer)Debit to Merchandise
Inventory and credit to cash
An item of merchandise with a list price of $200 was purchased with a trade discount of
40% and credit terms of 3/10, n/30. The vendor was paid within the discount period.
From the buyer's standpoint, which is the correct journal entry to record the payment? -
(correct answer)Accounts Payable, debit, $120.00; Merchandise Inventory, credit $3.60;
Cash, credit, $116.40
The buyer received an invoice from the seller for merchandise with a list price of $400
and credit terms of 2/10, n/60. The term 'n/60' in the credit terms is which of the
following? - (correct answer)Credit Period
Part of the merchandise purchased for cash at an earlier time is now being returned.
Which of the following is the correct journal entry FOR THE BUYER for this return,
assuming the seller grants cash refunds and a perpetual inventory system is used? -
(correct answer)A debit to cash and a credit to Merchandise Inventory
Net Sales is Sales less - (correct answer)Sales returns and allowances and sales
discounts
The records for Uptown Pet Shop showed the following: Sales $225,000 Beginning
merchandise inventory $30,000 Purchases 135,000 Cost of goods sold 150,000. What
was the ending merchandise inventory? - (correct answer)$15,000
Because Cost of goods sold 150,000
-Purchases 135,000
=$15,000
Under a perpetual inventory system merchandise is purchased for cash. Which is the
correct journal entry to record this purchase? - (correct answer)Debit to Merchandise
Inventory and credit to cash
An item of merchandise with a list price of $200 was purchased with a trade discount of
40% and credit terms of 3/10, n/30. The vendor was paid within the discount period.
From the buyer's standpoint, which is the correct journal entry to record the payment? -
(correct answer)Accounts Payable, debit, $120.00; Merchandise Inventory, credit $3.60;
Cash, credit, $116.40
The buyer received an invoice from the seller for merchandise with a list price of $400
and credit terms of 2/10, n/60. The term 'n/60' in the credit terms is which of the
following? - (correct answer)Credit Period
Part of the merchandise purchased for cash at an earlier time is now being returned.
Which of the following is the correct journal entry FOR THE BUYER for this return,
assuming the seller grants cash refunds and a perpetual inventory system is used? -
(correct answer)A debit to cash and a credit to Merchandise Inventory
Net Sales is Sales less - (correct answer)Sales returns and allowances and sales
discounts
