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What is the merchandise inventory of Glaus 1. Reyes Company had a gross profit of $360,000, total purchases of $420,000, and an ending inventory of $240,000 in its first year of operations as a retailer. Reyes’s sales in its first year must have been a. $540,000. b. $660,000. c. $180,000. d. $600,000. 2. A markup of 40% on cost is equivalent to what markup on selling price? a. 29% b. 40% c. 60% d. 71% 3. Kesler, Inc. ...

Other / Other 06 May 2016

Goods in transit which are shipped f.o.b. destination should be 1. When using a perpetual inventory system, a. no Purchases account is used. b. a Cost of Goods Sold account is used. c. two entries are required to record a sale. d. all of these. 2. Goods in transit which are shipped f.o.b. shipping point should be a. included in the inventory of the seller. b. included in the inventory of the buyer. c. included in the inventory o ...

Other / Other 06 May 2016

If both purchases and ending inventory are overstated by the same amount, net income is not affected TRUE OR FALSE: 1. Companies must allocate the cost of all the goods available for sale (or use) between the income statement and the statement of financial position. 2. When using a perpetual inventory system, freight charges on goods purchased are debited to Freight-In. 3. If a supplier ships goods f.o.b. destination, title passe ...

Other / Other 06 May 2016

Compute the cost of goods sold for the first six months under the periodic FIFO inventory Ex. 1—FIFO and LIFO–Periodic Josh Beckett shop began operations on January 2, 2010. The following stock record card for baseballs was taken from the records at the end of the year. Units Unit Invoice Gross Invoice Date Terms Received Cost Amount ...

Other / Other 06 May 2016

Payment was made thirty days after the purchase 1—Recording purchases at net amounts. Flint Co. records purchase discounts lost and uses perpetual inventories. Prepare journal entries in general journal form for the following: (a) Purchased merchandise costing $900 with terms 2/10, n/30. (b) Payment was made thirty days after the purchase . Ex. 2—Recording purchases at net amounts. Dill Co. records purchases at net a ...

Other / Other 06 May 2016

How might a company obtain a price index in order to apply dollar-value LIFO 1. When a company uses LIFO for external reporting purposes and FIFO for internal reporting purposes, an Allowance to Reduce Inventory to LIFO account is used. This account should be reported a. on the income statement in the Other Revenues and Gains section. b. on the income statement in the Cost of Goods Sold section. c. on the income statement in the Other ...

Other / Other 06 May 2016

What dollar amounts should be reported for the final inventory Pr. 1—Accounting for purchase discounts. Otto Corp. purchased merchandise during 2010 on credit for $300,000; terms 2/10, n/30. All of the gross liability except $60,000 was paid within the discount period. The remainder was paid within the 30-day term. At the end of the annual accounting period, December 31, 2010, 90% of the merchandise had been sold and 10% remained ...

Other / Other 06 May 2016

LIFO is inappropriate where unit costs tend to decrease as production increases TRUE OR FALSE: 1. The dollar-value LIFO method measures any increases and decreases in a pool in terms of total dollar value and physical quantity of the goods. 2. A disadvantage of LIFO is that it does not match more recent costs against current revenues as well as FIFO. 3. The LIFO conformity rule requires that if a company uses LIFO for tax purpo ...

Other / Other 06 May 2016

When inventory is misstated, its presentation lacks 1. When inventory is misstated, its presentation lacks ? a. Relevance. b. Faithful representation. c. Comparability. d. All of the choices are correct. 2. Which of the following costs should not be included on the statement of financial position as part of the cost of inventory? a. Abnormal freight. b. Import duties. c. Conversion costs. d. All of the choices are included on t ...

Other / Other 06 May 2016

What is the corrected amount for total assets and net income for the year 1. Risers Inc. reported total assets of $1,600,000 and net income of $85,000 for the current year. Risers determined that inventory was understated by $23,000 at the beginning of the year and $10,000 at the end of the year. What is the corrected amount for total assets and net income for the year ? a. $1,610,000 and $95,000. b. $1,590,000 and $98,000. c. $1,610,0 ...

Other / Other 06 May 2016