ACC 211 Chap 4

A company purchased $11,000 of merchandise on June 15 with terms of 3/10, n/45, and FOB shipping point. The freight charge, $1,000, was added to the invoice amount. On June 20, it returned $1,600 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:

$10,118.

Cushman Company had $818,000 in sales, sales discounts of $12,270, sales returns and allowances of $18,405, cost of goods sold of $388,550, and $281,395 in operating expenses. Net income equals:

$117,380.

Garza Company had sales of $148,200, sales discounts of $2,225, and sales returns of $3,560. Garza Company's net sales equals:

$142,415.

Prentice Company had cash sales of $94,825, credit sales of $83,775, sales returns and allowances of $1,925, and sales discounts of $3,700. Prentice's net sales for this period equal:

$172,975.

A company purchases merchandise with a catalog price of $26,500. The company receives a 30% trade discount from the seller. 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?

$18,179.

A company purchased $3,000 of merchandise on July 5 with terms 2/10, n/30. On July 7, it returned $330 worth of merchandise. On July 8, it paid the full amount due. The amount of the cash paid on July 8 equals:

$2,617.

A company has net sales of $792,200 and cost of goods sold of $572,200. Its net income is $27,160. The company's gross margin and operating expenses, respectively, are:

$220,000 and $192,840

A company has sales of $411,000 and its gross profit is $173,500. Its cost of goods sold equals:

$237,500.

A buyer of $8,300 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:

$249.

A company has net sales of $829,000 and cost of goods sold of $549,500. Its net income is $99,000. The company's gross margin and operating expenses, respectively, are:

$279,500 and $180,500

A company purchased $3,900 worth of merchandise. Transportation costs were an additional $340. The company returned $270 worth of merchandise and then paid the invoice within the 3% cash discount period. The total cost of this merchandise is:

$3,861.10.

Cushman Company had $846,000 in sales, sales discounts of $12,690, sales returns and allowances of $19,035, cost of goods sold of $401,850, and $291,025 in operating expenses. Gross profit equals:

$412,425.

A company has sales of $759,600 and cost of goods sold of $304,600. Its gross profit equals:

$455,000.

Cushman Company had $840,000 in net sales, $367,500 in gross profit, and $210,000 in operating expenses. Cost of goods sold equals:

$472,500.

A company purchased $8,700 of merchandise on June 15 with terms of 3/10, n/45. On June 20, it returned $435 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:

$8,017.

KLM Corporation's quick assets are $6,145,000, its current assets are $13,635,000 and its current liabilities are $8,161,000. Its acid-test ratio equals:

0.75. acid test = (cash+ accounts receivable+marketable securities)/current liabilities

A company's current assets are $25,420, its quick assets are $14,690 and its current liabilities are $12,420. Its acid-test ratio equals:

1.18.

Using the following year-end information for Calvin's Clothing, calculate the current ratio and acid-test ratio for the business: Cash$58,110 Short-term investments 14,000 Accounts receivable 58,000 Inventory 270,000 Prepaid expenses 5,600 Accounts payable 108,000 Other current payables 31,900

2.90 and 0.93

A company's gross profit (or gross margin) was $121,260 and its net sales were $475,900. Its gross margin ratio is:

25.5%.

A company had net sales of $809,400 and cost of goods sold of $573,110. Its net income was $30,200. The company's gross margin ratio equals:

29.2%

Using the following year-end information for Bauman, LLC, calculate the current ratio and acid-test ratio: Cash- $41,360 Short-term investments- 9,400 Accounts receivable- 41,000 Inventory- 242,000 Prepaid expenses- 16,240 Accounts payable- 88,600 Other current payables- 22,900

3.14 and 0.82.

A company's net sales are $821,860, its costs of goods sold are $451,200, and its net income is $113,250. Its gross margin ratio equals:

45.1%.

Mega Skateboard Supplier had net sales of $4.1 million, its cost of goods sold was $1.6 million, and its net income was $0.7 million. Its gross margin ratio equals:

61%.

A company's net sales were $705,800, its cost of goods sold was $241,380 and its net income was $50,150. Its gross margin ratio equals:

65.8%.

A company purchased $3,800 of merchandise on July 5 with terms 3/10, n/30. On July 7, it returned $900 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 $2,900; credit Merchandise Inventory $87; credit Cash $2,813.

A company's current assets are $20,630, its quick assets are $11,660 and its current liabilities are $13,100. Its quick ratio equals:

Quick Ratio = Quick Asset / Current Liabilities 0.89.

On February 3, Smart Company sold merchandise in the amount of $4,900 to Truman Company, with credit terms of 3/10, n/30. The cost of the items sold is $3,380. Smart uses the perpetual inventory system and the gross method. Truman pays the invoice on February 8, and takes the appropriate discount. The journal entry that Smart makes on February 8 is:

fCash - 4,753 fSales discounts- 147 ---Accounts receivable - 4,900