Chapter 5 Quiz\t\t\t\t\t\t\t\t\t\u00a0\t\t\t\t\t\t\t\t\tQuestion 1\t\t\t\t\t\t\t\t\t\u00a0\t\t\t\t\t\t\t\t\tAn advantage of using the periodic inventory system is that it requires less record keeping than the perpetual inventory system.\t\t\t\t\t\t\t\t\tQuestion 2\t\t\t\t\t\t\t\t\t\u00a0\t\t\t\t\t\t\t\t\tThe terms 2\/10, net\/30 mean that a 2 percent discount is allowed on payments made within the 10 days discount period.\t\t\t\t\t\t\t\t\tQuestion 3 \t\t\t\t\t\t\t\t\tSales allowances and Sales discounts are both designed to encourage customers to pay their accounts promptly.\t\t\t\t\t\t\t\t\tQuestion 4 \t\t\t\t\t\t\t\t\tFreight-out appears as an operating expense in the income statement.\t\t\t\t\t\t\t\t\tQuestion 5\t\t\t\t\t\t\t\t\t\u00a0\t\t\t\t\t\t\t\t\tWith the periodic inventory system, goods available for sale must be calculated before cost of goods sold.\t\t\t\t\t\t\t\t\tQuestion 6\t\t\t\t\t\t\t\t\t\u00a0\t\t\t\t\t\t\t\t\tMerchandising companies that sell to retailers are known as\t\t\t\t\t\t\t\t\tQuestion 7\t\t\t\t\t\t\t\t\t\u00a0\t\t\t\t\t\t\t\t\tThe primary source of revenue for a wholesaler is\t\t\t\t\t\t\t\t\tQuestion 8\t\t\t\t\t\t\t\t\t\u00a0\t\t\t\t\t\t\t\t\tWhich of the following is a true statement about inventory systems?\t\t\t\t\t\t\t\t\tQuestion 9\t\t\t\t\t\t\t\t\t\u00a0\t\t\t\t\t\t\t\t\tWhich of the following items does not result in an adjustment in the merchandise inventory account under a perpetual system?\t\t\t\t\t\t\t\t\tQuestion 10\t\t\t\t\t\t\t\t\t\u00a0\t\t\t\t\t\t\t\t\tFarwell Company purchased merchandise with an invoice price of $2,000 and credit terms of 1\/10, n\/30. Assuming a 360 day year, what is the implied annual interest rate inherent in the credit terms?\t\t\t\t\t\t\t\t\tQuestion 5\t\t\t\t\t\t\t\t\t\u00a0\t\t\t\t\t\t\t\t\tWith the periodic inventory system, goods available for sale must be calculated before cost of goods sold.\t\t\t\t\t\t\t\t\tQuestion 6\t\t\t\t\t\t\t\t\t\u00a0\t\t\t\t\t\t\t\t\tMerchandising companies that sell to retailers are known as\t\t\t\t\t\t\t\t\tQuestion 7\t\t\t\t\t\t\t\t\t\u00a0\t\t\t\t\t\t\t\t\tThe primary source of revenue for a wholesaler is\t\t\t\t\t\t\t\t\tQuestion 8\t\t\t\t\t\t\t\t\t\u00a0\t\t\t\t\t\t\t\t\tWhich of the following is a true statement about inventory systems?\t\t\t\t\t\t\t\t\tQuestion 9\t\t\t\t\t\t\t\t\t\u00a0\t\t\t\t\t\t\t\t\tWhich of the following items does not result in an adjustment in the merchandise inventory account under a perpetual system?\t\t\t\t\t\t\t\t\tQuestion 10\t\t\t\t\t\t\t\t\t\u00a0\t\t\t\t\t\t\t\t\tFarwell Company purchased merchandise with an invoice price of $2,000 and credit terms of 1\/10, n\/30. Assuming a 360 day year, what is the implied annual interest rate inherent in the credit terms?\t\t\t\t\t\t\t\t\tQuestion 11\t\t\t\t\t\t\t\t\t\u00a0\t\t\t\t\t\t\t\t\tAs the president of Harter Company, you notice that no discounts have been taken when settling accounts payables. What would be an acceptable explanation?\t\t\t\t\t\t\t\t\tQuestion 12\t\t\t\t\t\t\t\t\t\u00a0\t\t\t\t\t\t\t\t\tA sales invoice is prepared when goods\t\t\t\t\t\t\t\t\tQuestion 13\t\t\t\t\t\t\t\t\t\u00a0\t\t\t\t\t\t\t\t\tThe Sales Returns and Allowances account does not provide information to management about\t\t\t\t\t\t\t\t\tQuestion 14\t\t\t\t\t\t\t\t\t\u00a0\t\t\t\t\t\t\t\t\tThe collection of a $700 account beyond the 2 percent discount period will result in a\t\t\t\t\t\t\t\t\tQuestion 15 \t\t\t\t\t\t\t\t\tWhich statement is incorrect?\t\t\t\t\t\t\t\t\tQuestion 16 \t\t\t\t\t\t\t\t\tMultiple-step income statements show\t\t\t\t\t\t\t\t\tQuestion 17\t\t\t\t\t\t\t\t\t\u00a0\t\t\t\t\t\t\t\t\tFinancial information is presented below:\t\t\t\t\tOperating expenses \ufffd \ufffd \ufffd \ufffd\u00a0\u00a0\u00a0\u00a0$\u00a0 28,000\t\t\t\t\tSales returns and allowances \ufffd \ufffd \ufffd 7,000\t\t\t\t\tSales discounts \ufffd \ufffd \ufffd \ufffd \ufffd \ufffd \ufffd\u00a0\u00a0 3,000\t\t\t\t\tSales revenue \ufffd \ufffd \ufffd \ufffd \ufffd \ufffd \ufffd 150,000\t\t\t\t\tCost of goods sold \ufffd \ufffd \ufffd \ufffd \ufffd \ufffd 91,000\t\t\t\t\t\u00a0\t\t\t\t\tThe gross profit rate would be\t\t\t\t\t\t\t\t\tQuestion 18\t\t\t\t\t\t\t\t\t\u00a0\t\t\t\t\t\t\t\t\tWhat is an advantage of using the multiple-step income statement?\t\t\t\t\t\t\t\t\tQuestion 19\t\t\t\t\t\t\t\t\t\u00a0\t\t\t\t\t\t\t\t\tWhich of the following provides the best rationale regarding analysts’ views about the information value of the gross profit rate versus the gross profit amount?\t\t\t\t\t\t\t\t\tQuestion 20 \t\t\t\t\t\t\t\t\tMatch the items below by entering the appropriate code letter in the space provided.<\/p>\n","protected":false},"excerpt":{"rendered":"
Chapter 5 Quiz \u00a0 Question 1 \u00a0 An advantage of using the periodic inventory system is that it requires less record keeping than the perpetual inventory system. Question 2 \u00a0 The terms 2\/10, net\/30 mean that a 2 percent discount Read More …<\/a><\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[],"tags":[],"class_list":["post-200198","post","type-post","status-publish","format-standard","hentry"],"_links":{"self":[{"href":"https:\/\/www.benedictsol.com\/blogs\/wp-json\/wp\/v2\/posts\/200198","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.benedictsol.com\/blogs\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.benedictsol.com\/blogs\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.benedictsol.com\/blogs\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/www.benedictsol.com\/blogs\/wp-json\/wp\/v2\/comments?post=200198"}],"version-history":[{"count":0,"href":"https:\/\/www.benedictsol.com\/blogs\/wp-json\/wp\/v2\/posts\/200198\/revisions"}],"wp:attachment":[{"href":"https:\/\/www.benedictsol.com\/blogs\/wp-json\/wp\/v2\/media?parent=200198"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.benedictsol.com\/blogs\/wp-json\/wp\/v2\/categories?post=200198"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.benedictsol.com\/blogs\/wp-json\/wp\/v2\/tags?post=200198"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}