ACC 101 Exam questions and
answers graded A+
Gross Margin is the difference between Net Sales and ? - ANS✅✅Cost of Goods Sold
Positive operating income will result if gross margin exceeds - ANS✅✅Operating Expense
Under the perpetual inventory system, in addition to making the entry to record a sale
revenue, a company would - ANS✅✅Debit Cost of Goods Sold and credit Merchandise Inventory
How do you record a sale using the PERIODIC method? - ANS✅✅DR AR/Cash
CR Sales Revenue
How do you record a sale using the Perpetual Method? - ANS✅✅DR AR/Cash
CR Sales Revenue
Adjusting Entry
DR COGS
CR Inventory
During periods of rising prices which inventory method usually results in the LOWEST inventory
evaluation Regardless, Periodic or Perpetual? - ANS✅✅LIFO
The entry to record a payment on a $1,500 account within the 2 percent discount
period would include a.. - ANS✅✅Original Entry
Dr. Purchases $1,500
Cr. AP $1,500
98% of $1,500 = $1,470
Payment
Dr. AP $1,500
, Cr. Cash $1,470
**Cr. Purchase Discount $30
(Contra-Purchases Account)
What should be included in the 12/31/07 inventory for DePaul
Corporation? - ANS✅✅Merchandise purchased FOB, shipping point (not yet received)
The year end adjusting entry to reflect an increase in the value of trading securities
includes a - ANS✅✅Dr. Allowance to Adjust ST
Investment
Cr. Unrealized Gain
The matching rule (MATCHING REVS + RELATED EXPENSES) - ANS✅✅necessitates the recording of
an estimated amount for bad debts in the period of
the related credit sale
Using the accounts receivable aging method, estimated uncollectible accounts are
$80,000. If the balance in the Allowance for Uncollectible Accounts is a $6,000 debit
before adjustment, what is the amount of the adjustment? - ANS✅✅Dr. Bad Debt Expense
$86,000
Cr. Allowance for Uncollectable Accounts $86,000
A company issues a check for $58 but records it as $85. On the bank reconciliation,
the $27 error should be - ANS✅✅Added to the balance per books
A company receives $515 for merchandise, of which $15 is for sales tax. The entry
to record the sale would include a - ANS✅✅Dr. Cash/AR $515
Cr. Sales Revenue $500
Cr. Sale Tax Payable $15
A capital expenditure is - ANS✅✅An expenditure for the purchase or expansion of a long term
asset
answers graded A+
Gross Margin is the difference between Net Sales and ? - ANS✅✅Cost of Goods Sold
Positive operating income will result if gross margin exceeds - ANS✅✅Operating Expense
Under the perpetual inventory system, in addition to making the entry to record a sale
revenue, a company would - ANS✅✅Debit Cost of Goods Sold and credit Merchandise Inventory
How do you record a sale using the PERIODIC method? - ANS✅✅DR AR/Cash
CR Sales Revenue
How do you record a sale using the Perpetual Method? - ANS✅✅DR AR/Cash
CR Sales Revenue
Adjusting Entry
DR COGS
CR Inventory
During periods of rising prices which inventory method usually results in the LOWEST inventory
evaluation Regardless, Periodic or Perpetual? - ANS✅✅LIFO
The entry to record a payment on a $1,500 account within the 2 percent discount
period would include a.. - ANS✅✅Original Entry
Dr. Purchases $1,500
Cr. AP $1,500
98% of $1,500 = $1,470
Payment
Dr. AP $1,500
, Cr. Cash $1,470
**Cr. Purchase Discount $30
(Contra-Purchases Account)
What should be included in the 12/31/07 inventory for DePaul
Corporation? - ANS✅✅Merchandise purchased FOB, shipping point (not yet received)
The year end adjusting entry to reflect an increase in the value of trading securities
includes a - ANS✅✅Dr. Allowance to Adjust ST
Investment
Cr. Unrealized Gain
The matching rule (MATCHING REVS + RELATED EXPENSES) - ANS✅✅necessitates the recording of
an estimated amount for bad debts in the period of
the related credit sale
Using the accounts receivable aging method, estimated uncollectible accounts are
$80,000. If the balance in the Allowance for Uncollectible Accounts is a $6,000 debit
before adjustment, what is the amount of the adjustment? - ANS✅✅Dr. Bad Debt Expense
$86,000
Cr. Allowance for Uncollectable Accounts $86,000
A company issues a check for $58 but records it as $85. On the bank reconciliation,
the $27 error should be - ANS✅✅Added to the balance per books
A company receives $515 for merchandise, of which $15 is for sales tax. The entry
to record the sale would include a - ANS✅✅Dr. Cash/AR $515
Cr. Sales Revenue $500
Cr. Sale Tax Payable $15
A capital expenditure is - ANS✅✅An expenditure for the purchase or expansion of a long term
asset
