ACC 291T Wk 1 – Practice: Connect Knowledge Check (2021.7 New)

On February 3, Smart Company sold merchandise in the amount of $5,800 to Truman Company, with credit terms of 2/10, n/30. The cost of the items sold is $4,000. 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:

Multiple Choice

Cash       3,920

Sales discounts       80

Accounts receivable            4,000

Cash       5,684

Sales discounts       116

Accounts receivable            5,800

Cash       5,800

Accounts receivable            5,800

Cash       5,684

Accounts receivable            5,684

Cash       4,000

Accounts receivable            4,000

On September 12, Ryan Company sold merchandise in the amount of $5,800 to Johnson Company, with credit terms of 2/10, n/30. The cost of the items sold is $4,000. Ryan uses the periodic inventory system and the net method of accounting for sales. The journal entry or entries that Ryan will make on September 12 is (are):

Multiple Choice

Sales       5,800

Accounts receivable            5,800

Accounts receivable       5,800

Sales            5,800

Accounts receivable       5,684

Sales            5,684

Accounts receivable       5,684

Sales            5,684

Cost of goods sold  4,000

Merchandise Inventory        4,000

Accounts receivable       5,800

Sales            5,800

Cost of Goods Sold       4,000

Merchandise inventory        4,000

Mega Skateboard Supplier had net sales of $2.8 million, its cost of goods sold was $1.6 million, and its net income was $0.9 million. Its gross margin ratio equals:

Multiple Choice

32%.

43%.

175%.

57%.

56%.

On September 12, Ryan Company sold merchandise in the amount of $5,800 to Johnson Company, with credit terms of 2/10, n/30. The cost of the items sold is $4,000. Ryan uses the periodic inventory system and the net method of accounting for sales. On September 14, Johnson returns some of the non-defective merchandise, which is restored to inventory. The selling price of the returned merchandise is $500 and the cost of the merchandise returned is $350. The entry or entries that Ryan must make on September 14 is (are):

Multiple Choice

Sales returns and allowances  490

Accounts receivable            490

Merchandise inventory   350

Cost of goods sold       350

Sales returns and allowances  350

Accounts receivable            350

Sales returns and allowances  490

Accounts receivable            490

Merchandise inventory   343

Cost of goods sold       343

Sales returns and allowances  490

Accounts receivable            490

Sales returns and allowances  500

Accounts receivable            500

A company purchased $4,000 worth of merchandise. Transportation costs were an additional $350. The company returned $275 worth of merchandise and then paid the invoice within the 2% cash discount period. The total cost of this merchandise is:

Multiple Choice

$3,995.00.

$3,725.00.

$4,000.50.

$3,925.00.

$4,075.00.

A company purchased $1,800 of merchandise on July 5 with terms 2/10, n/30. On July 7, it returned $200 worth of merchandise. On July 28, it paid the full amount due. The amount of the cash paid on July 28 equals:

Multiple Choice

$1,600.

$1,568.

$200.

$1,800.

$1,564.

A company’s current assets are $23,420, its quick assets are $13,890 and its current liabilities are $12,220. Its acid-test ratio equals:

Multiple Choice

1.91.

0.52.

0.88.

1.41.

1.14.

A company purchased $1,800 of merchandise on July 5 with terms 2/10, n/30. On July 7, it returned $200 worth of merchandise. On July 8, it paid the full amount due. The amount of the cash paid on July 8 equals:

Multiple Choice

$200.

$1,800.

$1,564.

$1,600.

$1,568.

Juniper Company uses a perpetual inventory system and the gross method of accounting for purchases. The company purchased $9,750 of merchandise on August 7 with terms 1/10, n/30. On August 11, it returned $1,500 worth of merchandise. On August 16, it paid the full amount due. The correct journal entry to record the payment on August 16 is:

Multiple Choice

Debit Accounts Payable $9,750; credit Merchandise Inventory $97.50; credit Cash $9,652.50.

Debit Accounts Payable $8,250; credit Merchandise Inventory $82.50; credit Cash $8,167.50.

Debit Accounts Payable $8,167.50; credit Cash $8,167.50.

Debit Merchandise Inventory $8,250; credit Cash $8,250.

Debit Cash $8,250; credit Accounts Payable $8,250.

A company uses the perpetual inventory system and recorded the following entry:

Accounts Payable   2,500

Merchandise Inventory        50

Cash            2,450

This entry reflects a:

Multiple Choice

Payment of the account payable less a 1% cash discount taken.

Sale of merchandise on credit.

Payment of the account payable less a 2% cash discount taken.

Return of merchandise.

Purchase of merchandise on credit.