ACC 231 Exam 2 Test Prep Question and answers correctly solved 2025/2026

ACC 231 Exam 2 Test Prep Question
and answers correctly solved
2025/2026
West, Inc. had beginning inventory of $10,000, purchases pf $25,000 and ending inventory of $5,000.
What is West's cost of merchandise sold?



a. $10,000

b. $25,000

c. $5,000

d. $30,000 - correct answer ✔d. $30,000



If a company purchased $2,000 of merchandise on account and paid for it during the discount period
with the terms of 2/10, n/30, and the company uses the perpetual inventory system, the journal entry
would be ______.



a. Accounts Payable DR $2,000

Cash CR $2,000

b. Merchandise Inventory DR $2,000

Accounts Payable CR $2,000

c. Accounts Payable DR $1,960

Merchandise Inventory CR $1,960

d. Accounts Payable DR $2,000

Merchandise Inventory CR $40

Cash CR $1,960 - correct answer ✔d. Accounts Payable DR $2,000

Merchandise Inventory CR $40

, Cash CR $1,960



If a $10,000 sale is made on January 1st, with terms of 2/10, n/30 how much would the discount be if
payment is made on January 9th?



a. $10,000

b. $200

c. $1,000

d. $0 - correct answer ✔b. $200



When the LIFO method is used, cost of merchandise sold is assumed to consist of ____.



a. The most recently purchased units

b. The oldest units

c. The units with the highest per unit cost

d. The units with the lowest per unit cost - correct answer ✔a. The most recently purchased units



Which of the following entries are required to record the cost of merchandise sold under a perpetual
inventory system?



a. Cost of Merchandise Sold DR XXX

Merchandise Inventory CR XXX

b. Cost of Merchandise Sold DR XXX

Purchases CR XXX

c. Merchandise Inventory DR XXX

Cost of Merchandise Sold CR XXX