ACC 290 Week 4 PRACTICE QUIZ (NEW)/Uoptutorial
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<strong>ACC</strong> <strong>290</strong> WEEK 4 <strong>PRACTICE</strong> <strong>QUIZ</strong> (<strong>NEW</strong>)<br />
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Question 1<br />
A SERVICE COMPANY's operating cycle is ordinarily shorter than that of a<br />
merchandising company.<br />
The operating cycle of a merchandising company is ordinarily shorter than that of a<br />
service company.<br />
Question 2<br />
Due to the turnover time of inventory, merchandising companies have an operating cycle<br />
that is longer than a SERVICE COMPANY.<br />
The operating cycle of a merchandising company is ordinarily ___________________<br />
that of a service firm.<br />
Question 3<br />
The cost of having merchandise delivered to the store is part of the cost of getting the<br />
inventory ready to sell. All costs incurred to get inventory ready to sell are included as<br />
part of Inventory account with a debit.<br />
Jax Company uses a perpetual INVENTORY SYSTEM and on November 30 purchased<br />
merchandise for which it must pay the shipping charges. Which of the following is one<br />
part of the required journal entry when Jax pays the shipping charges of $200?<br />
Question 4
Sales Discounts is a contra account to Sales Revenue. It is reported on the income<br />
statement as a deduction from Sales Revenue.<br />
Question 5<br />
Two entries are required. One will record the sale with a debit to cash and a credit to sales<br />
revenue. The second entry is to reduce the inventory; debit cost of goods sold AND<br />
CREDIT inventory.<br />
Which statement is true when recording the sale of goods for cash in a perpetual<br />
inventory system?<br />
Question 6<br />
Sales less cost of goods sold equals gross profit. Subtracting operating expenses from<br />
gross profit equals net income.<br />
Net income is $15,000, operating expenses are $20,000, and net sales total $75,000. How<br />
much is cost of goods sold?<br />
Question 7<br />
Cost of goods sold is subtracted from net sales to calculate gross profit.<br />
Which one of the following will result in gross profit?<br />
Question 8<br />
Under the periodic inventory system, cost of goods sold for the period is calculated by<br />
adding purchases for the period to the beginning inventory balance and subtracting the<br />
ending inventory balance.<br />
Under what system is cost of goods sold determined at the end of an accounting period?<br />
Question 9<br />
Net income ($15,000) divided by net sales ($75,000) equals profit margin of 20%.<br />
Net income is $15,000, operating expenses are $20,000, net sales total $75,000, and sales<br />
revenues total $95,000. How much is the profit margin?<br />
Question 10
Unlike the perpetual system, companies do not attempt to record the cost of merchandise<br />
sold on the date of the sale. At the end of the period, a physical inventory is taken to<br />
determine the cost of merchandise sold.<br />
In a periodic inventory system, when is the cost of the merchandise sold determined?
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