Accounting 211 Exam #2
A company purchased $11,800 of merchandise on June 15 with terms of 3/10, n/45, and FOB shipping point. On June 20, it returned $2,240 of that merchandise. The shipping charges for the purchase totaled $1,400. On June 24, it paid the balance owed for the merchandise taking any discount it is entitled to. The cash paid on June 24 equals:
$10,673.
Pelcher Company maintains a $500 petty cash fund. On January 31, the fund is replenished. The accumulated receipts on that date represent $130 for office supplies, $180 for merchandise inventory, and $90 for miscellaneous expenses. There is a cash overage of $10. Based on this information, the amount of cash in the fund before the replenishment is:
$110.
Cushman Company had $830,000 in sales, sales discounts of $12,450, sales returns and allowances of $18,675, cost of goods sold of $394,250, and $285,520 in operating expenses. Net income equals:
$119,105.
Garza Company had sales of $152,200, sales discounts of $2,300, and sales returns of $3,655. Garza Company's net sales equals:
$146,245.
On December 31 of the current year, Plunkett Company reported an ending inventory balance of $213,500. The following additional information is also available: Plunkett sold and shipped goods costing $37,700 to Savannah Enterprises on December 28 with shipping terms of FOB shipping point. The goods were not included in the ending inventory amount of $213,500. Plunkett purchased goods costing $43,700 on December 29. The goods were shipped FOB destination and were received by Plunkett on January 2 of the following year. The shipment was a rush order that was supposed to arrive by December 31. These goods were included in the ending inventory balance of $213,500. Plunkett's ending inventory balance of $213,500 included $14,700 of goods being held on consignment from Carole Company. (Plunkett Company is the consignee.) Plunkett's ending inventory balance of $213,500 did not include goods costing $94,700 that were shipped to Plunkett on December 27 with shipping terms of FOB destination and were still in transit at year-end. Based on the above information, the amount that Plunkett should report in ending inventory on December 31 is:
$155,100
On December 31 of the current year, Plunkett Company reported an ending inventory balance of $216,000. The following additional information is also available: Plunkett sold and shipped goods costing $38,200 to Savannah Enterprises on December 28 with shipping terms of FOB shipping point. The goods were not included in the ending inventory amount of $216,000. Plunkett purchased goods costing $44,200 on December 29. The goods were shipped FOB destination and were received by Plunkett on January 2 of the following year. The shipment was a rush order that was supposed to arrive by December 31. These goods were included in the ending inventory balance of $216,000. Plunkett's ending inventory balance of $216,000 included $15,200 of goods being held on consignment from Carole Company. (Plunkett Company is the consignee.) Plunkett's ending inventory balance of $216,000 did not include goods costing $95,200 that were shipped to Plunkett on December 27 with shipping terms of FOB destination and were still in transit at year-end. Based on the above information, the amount that Plunkett should report in ending inventory on December 31 is:
$156,600
Prince Company had cash sales of $95,325, credit sales of $84,075, sales returns and allowances of $2,125, and sales discounts of $3,900. Prince's net sales for this period equal:
$173,375.
A company purchased $2,800 of merchandise on July 5 with terms 3/10, n/30. On July 7, it returned $310 worth of merchandise. On July 8, it paid the full amount due. The amount of the cash paid on July 8 equals:
$2,415.
TB MC Qu. 05-100 (Algo) A company's inventory records indicate the following... A company's inventory records indicate the following data for the month of January: Date Activities Units Acquired at Cost Units Sold at Retail January 1 Beginning inventory 510 units @ $18 = $9,180 January 8 Purchase 490 units @ $20 = $9,800 January 12 Sale 900 units @ $70 January 17Purchase 550 units @ $22 = $12,100 January 23 Sale 375 units @ $70 January 28Purchase 610 units @ $24 = $14,640 If the company uses the LIFO perpetual inventory system, what would be the cost of the ending inventory?
$20,290.
A company has net sales of $806,800 and cost of goods sold of $582,800. Its net income is $30,660. The company's gross margin and operating expenses, respectively, are:
$224,000 and $193,340
A company has net sales of $389,400 and its gross profit is $163,900. Its cost of goods sold is:
$225,500.
A buyer of $7,900 in merchandise inventory failed to take advantage of the vendor's credit terms of 3/15, n/45, and instead paid the invoice in full at the end of 45 days. By not taking advantage of the cash discount, the buyer lost the discount of:
$237.
A company purchases merchandise for $28,500. The seller also offers credit terms of 2/10, n/30. Assuming no returns were made, and that payment was made within the discount period, what is the net cost of the merchandise?
$27,930.
A company has net sales of $847,000 and cost of goods sold of $561,500. Its net income is $101,200. The company's gross profit and operating expenses, respectively, are:
$285,500 and $184,300
Bedrock Company reported a December 31 ending inventory balance of $413,000. The following additional information is also available: The ending inventory balance of $413,000 included $73,400 of consigned inventory for which Bedrock was the consignor. The ending inventory balance of $413,000 incorrectly included $24,800 of office supplies that were stored in the warehouse and were to be used by the company's supervisors and managers during the coming year. Based on this information, the correct balance for ending inventory on December 31 is:
$388,200
Bedrock Company reported a December 31 ending inventory balance of $414,500. The following additional information is also available: The ending inventory balance of $414,500 included $73,700 of consigned inventory for which Bedrock was the consignor. The ending inventory balance of $414,500 incorrectly included $25,400 of office supplies that were stored in the warehouse and were to be used by the company's supervisors and managers during the coming year. Based on this information, the correct balance for ending inventory on December 31 is:
$389,100
A company purchased $4,500 worth of merchandise. Transportation costs for the buyer were an additional $395. The company returned $310 worth of merchandise and then paid the invoice within the 3% cash discount period. The total cost of this merchandise is:
$4,459.30.
Cushman Company had $836,000 in sales, sales discounts of $12,540, sales returns and allowances of $18,810, cost of goods sold of $397,100, and $287,585 in operating expenses. Gross profit equals:
$407,550.
A company has net sales of $746,000 and cost of goods sold of $299,000. Its gross profit equals:
$447,000.
Cushman Company had $830,000 in net sales, $363,125 in gross profit, and $207,500 in operating expenses. Cost of goods sold equals:
$466,875.
Meng Company maintains a $400 petty cash fund. On January 31, the fund is replenished. The accumulated receipts on that date represent $100 for office supplies, $200 for merchandise inventory, and $40 for miscellaneous expenses. There is a cash shortage of $10. Based on this information, the amount of cash in the fund before the replenishment is:
$50
A company had the following purchases and sales during the month of November: Date Activities Units Acquired at Cost Units Sold at Retail November 1 Beginning inventory 5 units @ $42 = $210 November 2 Purchase10 units @ $44 = $440 November 6 Purchase6 units @ $47 = $282 November 8 Sales 8 units @ $88 Using the LIFO perpetual inventory method, what was the value of the inventory on November 8 after the sale?
$562
A company purchased $9,000 of merchandise on June 15 with terms of 3/10, n/45. On June 20, it returned $450 of that merchandise. On June 24, it paid the balance owed for the merchandise taking any discount it was entitled to. The cash paid on June 24 equals:
$8,294.
Blue Wing Corporation's quick assets are $5,902,000, its current assets are $11,880,000 and its current liabilities are $8,008,000. Its acid-test ratio equals:
0.74.
A company's current assets are $18,390, its quick assets are $9,960 and its current liabilities are $12,300. Its quick ratio is closest to:
0.81.
TB MC Qu. 04-84 (Algo) Using the following year-end... Using the following year-end information for Work-Fit calculate the acid-test ratio: Cash$ 53,150 Short-term investments 10,000 Accounts receivable (all current) 50,000 Inventory 190,000 Supplies 6,660 Accounts payable 104,000 Wages payable 30,700
0.84
Using the following year-end information for Coachmen, LLC, calculate the acid-test ratio: Cash $ 54,960 Short-term investments 11,200 Accounts receivable 45,500 Inventory 234,000 Prepaid expenses 26,840 Accounts payable 94,900 Salaries payable 25,600
0.93
A company's current assets are $26,420, its quick assets are $15,090 and its current liabilities are $12,520. Its acid-test ratio equals:
1.21.
Beckenworth had cost of goods sold of $11,421 million, ending inventory of $4,089 million, and average inventory of $2,165 million. Its days' sales in inventory equals: (Use 365 days a year.)
130.7 days.
A company's gross profit (or gross margin) was $82,280 and its net sales were $374,000. Its gross margin ratio is:
22%.
A company had net sales of $755,700 and cost of goods sold of $544,920. Its net income was $18,400. The company's gross margin ratio equals:
27.9%
Sandoval needs to determine its year-end inventory. The warehouse contains 31,000 units, of which 4,100 were damaged by flood and are not sellable. Another 3,100 units were purchased from Markor Company, FOB shipping point, and are currently in transit. The company also consigns goods and has 5,100 units at a consignee's location. How many units should Sandoval include in its year-end inventory?
35,100
Giorgio had cost of goods sold of $9,541 million, ending inventory of $2,209 million, and average inventory of $2,085 million. Its inventory turnover equals:
4.58.
Giorgio had cost of goods sold of $9,505 million, ending inventory of $2,173 million, and average inventory of $2,049 million. Its inventory turnover equals:
4.64.
A company's net sales are $794,770, its costs of goods sold are $441,890, and its net income is $107,820. Its gross margin ratio equals:
44.4%.
A company had net sales of $30,400 and accounts receivable of $3,800 for the current period. Its days' sales uncollected equals: (Use 365 days a year.)
45.63 days.
P&P Skateboards had net sales of $2,600,000, its cost of goods sold was $1,400,000, and its net income was $900,000. Its gross margin ratio equals:
46%.
A company's net sales were $746,100, its cost of goods sold was $246,960 and its net income was $72,300. Its gross margin ratio equals:
66.9%.
Beckenworth had cost of goods sold of $9,621 million, ending inventory of $2,289 million, and average inventory of $1,985 million. Its days' sales in inventory equals: (Use 365 days a year.)
86.8 days.
The custodian of a $450 petty cash fund discovers that the fund has $60.70 in coins and currency plus $384.00 in receipts at the end of the month. The entry to replenish the petty cash fund will include:
A credit to Cash for $389.30.
The custodian of a $540 petty cash fund discovers that the fund has $92.50 in coins and currency plus $436.50 in receipts at the end of the month. The entry to replenish the petty cash fund will include:
A debit to Cash Over and Short for $11.00.
On February 3, Smart Company sold merchandise in the amount of $4,600 to Kennedy Company, with credit terms of 3/10, n/30. The cost of the items sold is $3,175. Smart uses the perpetual inventory system and the gross method. Kennedy pays the invoice on February 8 and takes the appropriate discount. The journal entry that Smart makes on February 8 is:
Account Title Debit Credit Cash 4,462 Sales discounts 138 Accounts Receivable 4,600
If a check correctly written and paid by the bank for $118 is incorrectly recorded in the company's books for $181, how should this error be treated on the bank reconciliation?
Add $63 to the book balance.
Spencer Company has a $410 petty cash fund. At the end of the first month the accumulated receipts represent $64 for delivery expenses, $211 for merchandise inventory, and $33 for miscellaneous expenses. The fund has a balance of $102. The journal entry to record the reimbursement of the account includes a:
Credit to Cash for $308.
A company purchased $1,900 of merchandise on July 5 with terms 2/10, n/30. On July 7, it returned $250 worth of merchandise. On July 12, it paid the full amount due. Assuming the company uses a perpetual inventory system, and records purchases using the gross method, the correct journal entry to record the payment on July 12 is:
Debit Accounts Payable $1,650; credit Merchandise Inventory $33; credit Cash $1,617.
At the end of the day, the cash register's record shows $1,278, but the count of cash in the cash register is $1,259. The correct entry to record the cash sales is
Debit Cash $1,259; debit Cash Over and Short $19; credit Sales $1,278.
At the end of the day, the cash register tape shows $1,220 in cash sales but the count of cash in the register is $1,285. The proper entry to account for this excess is:
Debit Cash $1,285; credit Sales $1,220; credit Cash Over and Short $65.
A company had $16 missing from petty cash that was not accounted for by petty cash receipts. The correct procedure is to:
Debit Cash Over and Short for $16.
Pelcher Company maintains a $450 petty cash fund. On January 31, the fund is replenished. The accumulated receipts on that date represent $120 for office supplies, $160 for merchandise inventory, and $80 for miscellaneous expenses. There is a cash overage of $6. The journal entry to replenish the fund on January 31 is:
Debit Office Supplies Expense, $120; Debit Merchandise inventory, $160; Debit Miscellaneous expenses, $80; Credit Cash over and short, $6; Credit Cash, $354.
Meng Company maintains a $395 petty cash fund. On January 31, the fund is replenished. The accumulated receipts on that date represent $99 for office supplies, $198 for merchandise inventory, and $39 for miscellaneous expenses. There is a cash shortage of $8. The journal entry to replenish the fund on January 31 is:
Debit Office Supplies Expense, $99; Debit Merchandise Inventory, $198; Debit Miscellaneous Expenses, $39; Debit Cash Over and Short, $8; Credit Cash, $344.
Havermill Company establishes a $330 petty cash fund on September 1. On September 30, the fund is replenished. The accumulated receipts on that date represent $81 for Office Supplies, $153 for merchandise inventory, and $30 for miscellaneous expenses. The fund has a balance of $66. On October 1, the accountant determines that the fund should be increased by $66. The journal entry to record the establishment of the fund on September 1 is:
Debit Petty Cash $330; credit Cash $330.
Havermill Company establishes a $320 petty cash fund on September 1. On September 30, the fund is replenished. The accumulated receipts on that date represent $80 for Office Supplies, $144 for merchandise inventory, and $29 for miscellaneous expenses. The fund has a balance of $25. On October 1, the accountant determines that the fund should be increased by $50. The journal entry to record the increase in the fund balance on October 1 is:
Debit Petty Cash $50; credit Cash $50.
A company wants to decrease its $200.00 petty cash fund to $150.00. The entry to reduce the fund is:
Debit to Cash $50.00; credit Petty Cash $50.00.
Havermill Company establishes a $480 petty cash fund on September 1. On September 30, the fund is replenished. The accumulated receipts on that date represent $96 for Repairs Expense, $183 for merchandise inventory, and $45 for miscellaneous expenses. The fund has a balance of $156. On October 1, the accountant determines that the fund should be increased by $96. The journal entry to record the reimbursement of the fund on September 30 includes a:
Debit to Repairs Expense for $96.
During the month of July, Clanton Industries issued a check in the amount of $834 to a supplier on account. The check did not clear the bank during July. In preparing the July 31 bank reconciliation, the company should:
Deduct the check amount from the bank balance.
If a check correctly written and paid by the bank for $382 is incorrectly recorded in the company's books for $326, how should this error be treated on the bank reconciliation?
Subtract $56 from the book balance.
