ACC 211 Chapter 4 & 5 MCQ

$261.

A buyer of $8,700 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:

Debit Cash Over and Short for $5.

A company had $5 missing from petty cash that was not accounted for by petty cash receipts. The correct procedure is to:

49.72 days.

A company had net sales of $30,100 and accounts receivable of $4,100 for the current period. Its days' sales uncollected equals: (Use 365 days a year.)

28.9%

A company had net sales of $796,700 and cost of goods sold of $566,510. Its net income was $27,450. The company's gross margin ratio equals:

$231,500.

A company has net sales of $400,200 and its gross profit is $168,700. Its cost of goods sold is:

$455,000.

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

$216,000 and $192,340

A company has net sales of $777,600 and cost of goods sold of $561,600. Its net income is $23,660. The company's gross margin and operating expenses, respectively, are:

$296,000 and $190,900

A company has net sales of $879,000 and cost of goods sold of $583,000. Its net income is $105,100. The company's gross profit and operating expenses, respectively, are:

$10,118.

A company purchased $11,000 of merchandise on June 15 with terms of 3/10, n/45, and FOB shipping point. On June 20, it returned $1,600 of that merchandise. The shipping charges for the purchase totaled $1,000. 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:

$2,934.

A company purchased $3,400 of merchandise on July 5 with terms 3/10, n/30. On July 7, it returned $375 worth of merchandise. On July 8, it paid the full amount due. The amount of the cash paid on July 8 equals:

66.1%.

A company's net sales were $716,900, its cost of goods sold was $243,030 and its net income was $55,900. Its gross margin ratio equals:

Debit Cash $1,335; credit Sales $1,260; credit Cash Over and Short $75.

At the end of the day, the cash register tape shows $1,260 in cash sales but the count of cash in the register is $1,335. The proper entry to account for this excess is:

Debit Cash $1,257; debit Cash Over and Short $17; credit Sales $1,274.

At the end of the day, the cash register's record shows $1,274, but the count of cash in the cash register is $1,257. The correct entry to record the cash sales is

95.3 days.

Beckenworth had cost of goods sold of $9,921 million, ending inventory of $2,589 million, and average inventory of $2,015 million. Its days' sales in inventory equals: (Use 365 days a year.)

Add $54 to the book balance.

If a check correctly written and paid by the bank for $439 is incorrectly recorded in the company's books for $493, how should this error be treated on the bank reconciliation?

$35.

Meng Company maintains a $335 petty cash fund. On January 31, the fund is replenished. The accumulated receipts on that date represent $87 for office supplies, $174 for merchandise inventory, and $27 for miscellaneous expenses. There is a cash shortage of $12. Based on this information, the amount of cash in the fund before the replenishment is:

63%.

P&P Skateboards had net sales of $3,500,000, its cost of goods sold was $1,300,000, and its net income was $800,000. Its gross margin ratio equals:

A credit to Cash for $391.70.

The custodian of a $450 petty cash fund discovers that the fund has $58.30 in coins and currency plus $386.00 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 $13.00.

The custodian of a $570 petty cash fund discovers that the fund has $102.50 in coins and currency plus $454.50 in receipts at the end of the month. The entry to replenish the petty cash fund will include:

Debit Accounts Payable $2,200; credit Merchandise Inventory $66; credit Cash $2,134.

A company purchased $3,000 of merchandise on July 5 with terms 3/10, n/30. On July 7, it returned $800 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:

$4,103.60.

A company purchased $4,100 worth of merchandise. Transportation costs for the buyer were an additional $360. The company returned $280 worth of merchandise and then paid the invoice within the 2% cash discount period. The total cost of this merchandise is:

$8,109.

A company purchased $8,800 of merchandise on June 15 with terms of 3/10, n/45. On June 20, it returned $440 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:

$25,970.

A company purchases merchandise for $26,500. 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?

Debit to Cash $100.00; credit Petty Cash $100.00.

A company wants to decrease its $200.00 petty cash fund to $100.00. The entry to reduce the fund is:

0.99.

A company's current assets are $23,310, its quick assets are $13,860 and its current liabilities are $14,000. Its quick ratio is closest to:

1.25.

A company's current assets are $28,420, its quick assets are $15,890 and its current liabilities are $12,720. Its acid-test ratio equals:

28%.

A company's gross profit (or gross margin) was $102,480 and its net sales were $366,000. Its gross margin ratio is:

44.4%.

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:

$390,900

Bedrock Company reported a December 31 ending inventory balance of $413,500. The following additional information is also available: The ending inventory balance of $413,500 included $72,300 of consigned inventory for which Bedrock was the consignor. The ending inventory balance of $413,500 incorrectly included $22,600 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:

0.74.

Blue Wing Corporation's quick assets are $5,956,000, its current assets are $12,270,000 and its current liabilities are $8,042,000. Its acid-test ratio equals:

$456,750.

Cushman Company had $812,000 in net sales, $355,250 in gross profit, and $203,000 in operating expenses. Cost of goods sold equals:

$116,520.

Cushman Company had $812,000 in sales, sales discounts of $12,180, sales returns and allowances of $18,270, cost of goods sold of $385,700, and $279,330 in operating expenses. Net income equals:

$402,675.

Cushman Company had $826,000 in sales, sales discounts of $12,390, sales returns and allowances of $18,585, cost of goods sold of $392,350, and $284,145 in operating expenses. Gross profit equals:

Deduct the check amount from the bank balance.

During the month of July, Clanton Industries issued a check in the amount of $967 to a supplier on account. The check did not clear the bank during July. In preparing the July 31 bank reconciliation, the company should:

$135,515.

Garza Company had sales of $141,000, sales discounts of $2,100, and sales returns of $3,385. Garza Company's net sales equals:

4.38

Giorgio had cost of goods sold of $9,661 million, ending inventory of $2,329 million, and average inventory of $2,205 million. Its inventory turnover equals:

Debit Petty Cash $60; credit Cash $60.

Havermill Company establishes a $290 petty cash fund on September 1. On September 30, the fund is replenished. The accumulated receipts on that date represent $77 for Office Supplies, $141 for merchandise inventory, and $26 for miscellaneous expenses. The fund has a balance of $22. On October 1, the accountant determines that the fund should be increased by $60. The journal entry to record the increase in the fund balance on October 1 is:

Debit Petty Cash $430; credit Cash $430.

Havermill Company establishes a $430 petty cash fund on September 1. On September 30, the fund is replenished. The accumulated receipts on that date represent $91 for Office Supplies, $173 for merchandise inventory, and $40 for miscellaneous expenses. The fund has a balance of $126. On October 1, the accountant determines that the fund should be increased by $86. The journal entry to record the establishment of the fund on September 1 is:

Debit to Repairs Expense for $98.

Havermill Company establishes a $500 petty cash fund on September 1. On September 30, the fund is replenished. The accumulated receipts on that date represent $98 for Repairs Expense, $187 for merchandise inventory, and $47 for miscellaneous expenses. The fund has a balance of $168. On October 1, the accountant determines that the fund should be increased by $100. The journal entry to record the reimbursement of the fund on September 30 includes a:

Subtract $50 from the book balance.

If a check correctly written and paid by the bank for $322 is incorrectly recorded in the company's books for $272, how should this error be treated on the bank reconciliation?

Debit Office Supplies Expense, $87; Debit Merchandise Inventory, $174; Debit Miscellaneous Expenses, $27; Debit Cash Over and Short, $12; Credit Cash, $300.

Meng Company maintains a $335 petty cash fund. On January 31, the fund is replenished. The accumulated receipts on that date represent $87 for office supplies, $174 for merchandise inventory, and $27 for miscellaneous expenses. There is a cash shortage of $12. The journal entry to replenish the fund on January 31 is:

$156,300

On December 31 of the current year, Plunkett Company reported an ending inventory balance of $215,500. The following additional information is also available: Plunkett sold and shipped goods costing $38,100 to Savannah Enterprises on December 28 with shipping terms of FOB shipping point. The goods were not included in the ending inventory amount of $215,500. Plunkett purchased goods costing $44,100 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 $215,500. Plunkett's ending inventory balance of $215,500 included $15,100 of goods being held on consignment from Carole Company. (Plunkett Company is the consignee.) Plunkett's ending inventory balance of $215,500 did not include goods costing $95,100 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:

Debit Office Supplies Expense, $111; Debit Merchandise inventory, $142; Debit Miscellaneous expenses, $71; Credit Cash over and short, $5; Credit Cash, $319.

Pelcher Company maintains a $405 petty cash fund. On January 31, the fund is replenished. The accumulated receipts on that date represent $111 for office supplies, $142 for merchandise inventory, and $71 for miscellaneous expenses. There is a cash overage of $5. The journal entry to replenish the fund on January 31 is:

$102.

Pelcher Company maintains a $455 petty cash fund. On January 31, the fund is replenished. The accumulated receipts on that date represent $121 for office supplies, $162 for merchandise inventory, and $81 for miscellaneous expenses. There is a cash overage of $11. Based on this information, the amount of cash in the fund before the replenishment is:

$172,950.

Prince Company had cash sales of $94,775, credit sales of $83,750, sales returns and allowances of $1,900, and sales discounts of $3,675. Prince's net sales for this period equal:

29,600

Sandoval needs to determine its year-end inventory. The warehouse contains 26,000 units, of which 3,600 were damaged by flood and are not sellable. Another 2,600 units were purchased from Markor Company, FOB shipping point, and are currently in transit. The company also consigns goods and has 4,600 units at a consignee's location. How many units should Sandoval include in its year-end inventory?

Credit to Cash for $326.

Spencer Company has a $440 petty cash fund. At the end of the first month the accumulated receipts represent $67 for delivery expenses, $223 for merchandise inventory, and $36 for miscellaneous expenses. The fund has a balance of $114. The journal entry to record the reimbursement of the account includes a: