Question

Question 16

On August 1, our company purchases $1,000 worth of merchandise inventory on credit with the terms 3/10, n/30. What is the amount we would credit to cash if we pay this invoice on August 9?

Group of answer choices

$1,000

$997

$990

$970

Question 17

Our company purchases $4,000 worth of merchandise inventory on credit with the terms 2/10, n/30. Transportation costs were an additional $200. Our company returned $300 worth of merchandise. What is the total cost of this merchandise if our company paid the invoice within the discount period?

Group of answer choices

$3,426

$3,826

$4,018

$4,410

Question 18

Our company uses a perpetual inventory system. On July 3, we sold merchandise with a cost of $3,300 for $6,600 to a customer on account. The terms of the sale were 2/10, n/30. What account and amount would we debit to record the sales revenue for this transaction?

Group of answer choices

sales revenue, $6,600

accounts receivable, $6,600

cost of goods sold, $3,300

merchandise inventory, $3,300

Question 19

Our company uses a perpetual inventory system. On July 3, we sold merchandise with a cost of $3,300 for $6,600 to a customer on account. The terms of the sale were 2/10, n/30. What account and amount would we credit to record the cost of goods sold for this transaction?

Group of answer choices

sales revenue, $6,600

accounts receivable, $6,600

cost of goods sold, $3,300

merchandise inventory, $3,300

Question 20

Our company had the following balances and transactions during the current year related to merchandise inventory.

Beginning merchandise inventory on January 1	100 units at $75 per unit
Purchase on February 14	100 units at $80 per unit
Sale on August 21	150 units

What would be the company’s ending merchandise inventory in dollars on December 31 if the company used perpetual, last in, first out (LIFO) method?

Group of answer choices

$4,000

$3,750

$11,500

$11,750

Answer 1

Question 16

Term 3/10 means, if company paid cash within 10 days, they will get a cash discount of 3%.

Cash discount will be : $1,000*3% = $30

Cash to be paid = $1,000 - $30 = $970

Answer is D. $970