FAC1502 Financial Accounting Elementary Calculations TEST Questions and Answers Verified Solutions Latest Update

FAC1502 Financial Accounting
Elementary Calculations
TEST Questions and Answers
Verified Solutions Latest Update


Question:

what type of accounts are sales discounts and sales returns and allowances?

Answer:
contra revenue accounts


Question:

gross profit calculation

Answer:
net sales-COGS


Question:

COGS calculation

Answer:
beginning inventory + purchases-ending inventory


Question:

Gross profit percentage calculation

Answer:
(gross profit / net sales) * 100


Question:

Goods available for sale calculation

Answer:
1. beginning inventory + purchases

, Question:

COGS + ending inventory


Question:

net income calculation

Answer:
gross profit-expenses


Question:

inventory turnover ratio calculation

Answer:
COGS / average inventory - (higher is better) - rate of sell


Question:

average inventory calculation

Answer:
(BI + EI) / 2


Question:

days to sell calculation

Answer:
365 / inventory turnover ratio - (lower is better) - age of inventory


Question:

gross profit margin calculation

Answer:
gross profit / net sales-higher is better-profitability of inventory


Question:

receivables turnover ratio calculation

Answer:
net sales revenue / average net receivable