Homework Answers
OPTION: Companies that use a perpetual inventory system must take a physical inventory to determine inventory on hand on the balance sheet date and to determine cost of goods sold for the accounting period.
EXPLANATION:
Under the perpetual inventory system, goods are taken as and when their is movement in them i.e. when purchased and when issued. There is immediate accounting of the inventory throughout the accounting period and not at on the balance sheet date.
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Practice Question 06 X Companies using a periodic inventory system take a physical inventory to determine the inventory on hand at the balance sheet date, and to determine the cost of goods sold for the period. Companies using a periodic inventory system take a physical inventory for each of the following purposes except to determine the O cost of goods sold for the period. inventory on hand at the balance sheet date. O amount of inventory lost due to shoplifting...
Question 4: complete the following statements: No. statement complete 1 expenses incurred in the process of earning sales revenue (Examples: sales salaries and insurance expense) 2 ..... profit equal Sales Revenue less Cost of Goods Sold 3 .......... Inventory: Detailed records of the cost of each item are maintained, and the cost of each item sold is determined from records when the sale occurs. 4 ......... Inventory: Cost of goods sold is determined only at the end of an accounting...
5. Assuming that costs are changing during the accounting period, under the last-in, first-out Inventory costing method, the amount of cost of goods sold calculated using the perpetual inventory system will usually differ or stay the same from the amount calculated using the periodic inventory system. 6. A company that uses the periodic inventory provides the following information: Beginning Inventory AED 12,000; Net Purchases AED 93,000 At the end of the period, the physical count of inventory reveals that AED...
13) Beginning inventory plus purchases quals A) ending inventory B) net purchases C) cost of goods sold oods available for sale D frue? 14) Which of the following statements and the r e who is A) A periodic inventory system kes detailed inventory records of the inventory on hand throughout the period. B) A perpetual inventory system does nor track the change in the inventory account as a result of a sale C) A periodic inventory system does not track...
Name 1. Actually counting the goods on hand at the end of the accounting period and determining the cost of these goods by reviewing the accounting records is called a. b. c. the cost of goods sold. the physical inventory. freight-in. accumulated depreciation. 2. Unearned revenue is reported as a(n) current liability on the balance sheet. b. contra-asset account on the chart of accounts owner's equity account on the work sheet. asset on the balance sheet. d. 3. The income...
Question 1 of 2 n !! View Policies Current Attempt in Progress Mr. Etemadi has prepared the following list of statements about service companies and merchandisers. Identify each statement as true or false. 1. Measuring net income for a merchandiser is conceptually the same as for a service company. < 2. For a merchandiser, sales less operating expenses is called gross profit. 3. For a merchandiser, the primary source of revenues is the sale of inventory. < Sales salaries and...
True or False (A=Ture; B=False) 1 A merchandising company's operating cycle begins with the acquisition of inventory and ends with the cash collection from sales. 2 Inventory shrinkage is the difference between inventory in the warehouse and inventory counted. 3 FOB shipping point means that ownership of goods passes to the buyer when the goods leave the seller's place of business. 4 In a periodic inventory system, two journal entries are required to record the sale of inventory. 5 The...
E5.1 (LO 1) Mr. McKenzie has prepared the following list of statements about service companies and merchandisers. 1. Measuring net income for a merchandiser is conceptually the same as for a service company. 2. For a merchandiser, sales less operating expenses is called gross profit. 3. For a merchandiser, the primary source of revenues is the sale of inventory. 4. Sales salaries and wages is an example of an operating expense. 5. The operating cycle of a merchandiser is the...
E8-7 Recording Purchases and Sales Using a Perpetual and Periodic Inventory System Demski Company reported beginning inventory of 100 units at a unit cost of $25. It engaged in the following purchase and sale transactions during 2007: Jan. 14 Sold 25 units at unit sales price of $40 on open account. April 9 Purchased 15 additional units at unit cost of $25 on open account. Sept. 2 Sold 50 units at sales price of $45 on open account. At the...
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