Accounting 201 Test 2

Herald Company had sales of $135,000, sales discounts of $2000, and sales returns of $3200. Herald Company's net sales equals:

$129,800

A company's net income was $83, 750, its net sales were $347,800, and its cost of goods sold was $147,800. The gross profit was:

$200,000

A company has net sales of cost of goods sold of $753,000 and $543,000, respectively. Its net income is $17,530. The company's gross margin and operating expenses are______and______.

$209,000 and $191,470

A company normally sells its product for @20 per unit. However, the selling price has fallen to $15 per unit. The company's current inventory consists of 200 units purchased at $16 per unit. Replacement cost has now fallen to $13 per unit. Calculate the value of this company's inventory at the lower of cost or market.

$2600

A company had inventory on November 1 of 5 units at a cost of $20 each. On November 2, they purchased 10 units at $22 each. On November 6 they purchased 6 units at $25 each. On November 8, 8 units were sold for $55 each. Using LIFO perpetual inventory method, what was the value of the inventory on November 8 after the sale?

$276

Brig Company had $600,000 in net sales, $250,000 in gross profit, and $200,000 in operating expenses. Cost of goods sold equals:

$350,000

A company had beginning inventory of $100,000, merchandise purchases of $400,000 and ending inventory of $50,000. It's cost of goods sold was:

$450,000

Georgia Peach Company reported net sales in June of the current year of $1,000,000. At the beginning of June, the company reported beginning inventory of $368,000. Cost of goods purchased during June amounted to $217,500. The company reported ending inventory at the end of June of $226,750. The company's gross profit for June of the current year was:

$641,250

A company records the following journal entry; debit Cash $1470, debit Sales Discounts $30, and credit Accounts Receivable $1500. This means that a customer has taken a ____cash discount for early payment.

2%

A company purchased $10,000 of merchandise on June 15 with terms of 3/10, n/45. On Junes 20, it returned $800 of that merchandise. 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:

8924

Assume that the custodian of a $450 petty cash fund has $62.50 in coins and currency plus $382.50 in receipts at the end of the month. The entry to replenish the petty cash fund will include:

A credit to Cash for $287.50

The entry necessary to establish a petty cash fund should include:

A debit to Petty Cash and credit to Cash

During a period of steadily rising costs, the inventory valuation method that yields the highest reported net income is:

FIFO method

Which of the following is the most serious limitation of internal controls?

Human fraud or human error

The inventory valuation method that identifies the invoice cost of each item in ending inventory to determine the cost assigned to the inventory is the:

Specific Identification Method.

Which of the following inventory costing methods will always result in the same values for ending inventory and cost of goods sold regardless of whether a perpetual or periodic inventory system is used?

Specific identification and FIFO

The current period's ending inventory is:

The next period's beginning inventory

Outstanding checks refer to checks that have been:

Written, recorded on the company books, set to the payee, but have not yet been paid by the bank.

Regardless of the inventory costing system used, cost of goods available for sale must be allocated between

ending inventory and cost of goods sold