1. 01/01/x1 WestCompany bought merchandise, on account from a vendor that cost$3
ID: 2458039 • Letter: 1
Question
1. 01/01/x1 WestCompany bought merchandise, on account from a vendor that cost$3,000, terms 2/10, n /30. West company will pay within thediscount period, what is the journal entry required forWest co on the date of purchase from the vendor (perpetualinventory system):
01/01/x1
2. Continued from #1 on 01/10/x1what is the journalentry required for West Co. on the date they pay for the goods(perpetual inventory system):
3. The buyer isresponsible for the shipping costs when the shipping terms are:
a) FOBdestination
b) CODdestination
c) FOB shippingpoint
d) COD shippingpoint
4. Consigned merchandise should beincluded in the ending inventory of the consignee.
True False
5. On 02/01/x1West Company sold $5,500 of merchandise, on account to a customer,that cost $2,940, terms 3/15, n /30. If the customer paid forthe merchandise within the discount period, what is thejournal entry required for West co on the date of sale to thecustomer (perpetual inventory system):
02/01/x1
6 Continued from #5 On 02/10/x1 the customerpaid for the merchandise within the discount period, whatis the journal entry required for West Co. on the date the customerpays (perpetual inventory system):
7. All of the following are valid methods of inventorycomputation except for:
a. First-in, first out
b. Last-in, last out
c. Weighted-average
d. Cost-plus-profit
e. Specific identification
8. The cost of your inventory has been appropriatelyvalued at $150,000. However the market value of the inventoryis $110,000. According to the lower of cost or market,the inventory will need to be put on your books for $110,000.
True False
9. The method of inventory computation that you chose willhave an impact on the net income that is computed on the incomestatement.
True False
10-12 The inventory transactions are as follows:
Units Unit cost ExtendedValue
Beginninginventory 300 $20 $6,000
Purchases2-10-2002 400 $22 8,800
Purchases2-20-2002 200 $23 4,600
Available 900 $19,400
Sales 2-15-2002 500
EndingInventory 400
10. Using the information outlined above, what isthe value of the ending inventory for a perpetual inventory systemusing the FIFO inventory valuation?
A. $8,000.00
B. $8,200.00
C. $8,600.00
D. $8,828.55
E. $9,000.00
11. Using the information outlined above, what is the valueof the ending inventory for a perpetual inventory system using theLIFO inventory valuation?
A. $8,000.00
B. $8,200.00
C. $8,600.00
D. $8,828.55
E. $9,000.00
Explanation / Answer
1.Inventory 3,000 Accountspayable 3,000 In the perpetual accounting system, Inventory is used instead ofpurchases. Please rate the answers so that you will get the answers fast andyour respect score in the profile will improve.
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