QUESTION 11 1. Referring to the following table, what is Net sales revenue? Sale

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QUESTION 11
1.   Referring to the following table, what is Net sales revenue?
Sales revenue   $460,000
Cost of goods sold   300,000
Operating expenses   85,000
Sales discounts   20,000
Sales returns and allowances   15,000
Interest revenue   5,000
2.     

A.   $400,000

B.   $455,000

C.   $425,000

D.   $415,000

QUESTION 12
1.   Which of the following states that a company must perform strictly proper accounting ONLY for items that are significant to the business's financial statements?

A.   Consistency principle

B.   Disclosure principle

C.   Accounting conservatism

D.   Materiality concept

QUESTION 13
1.   Under which of the following inventory costing methods is the Cost of goods sold based on the cost of the oldest purchases?

A.   Specific-unit-cost

B.   Last-In, First-Out

C.   Average-cost

D.   First-In, First-Out

QUESTION 14
1.   Using the perpetual inventory system, discounts taken on an invoice, such as 3/10, n/30, would be:

A.   debited to Inventory.

B.   credited to Cost of goods sold.

C.   debited to Cost of goods sold.

D.   credited to Inventory.

QUESTION 15
1.   Beginning inventory is $28,000. Purchases for the year are $110,000. Sales revenues are $180,000. The company's normal gross profit percent is 60%. How much is estimated ending inventory?

A.   $30,000

B.   $246,000

C.   $66,000

D.   $72,000

QUESTION 16
1.   Which of the following requires that financial statements should report the LEAST favorable figures?

A.   Materiality concept

B.   Consistency principle

C.   Accounting conservatism

D.   Disclosure principle

QUESTION 17
1.   Which inventory valuation model serves as a middle-of-the-road approach for taxes and income?

A.   Average-cost

B.   Specific-unit-cost

C.   Last-In, First-Out

D.   First-In, First-Out

QUESTION 18
1.   What is the difference between a sales return and a sales allowance?

A.   A sales return reduces the amount receivable from the customer, but an allowance does not.

B.   A sales return involves an adjustment to Inventory, but a sales allowance does not.

C.   A sales return requires a debit to Sales returns and allowances, but a sales allowance does not.

D.   A sales allowance is deducted from Sales revenue to calculate net sales, but a sales return is not.

QUESTION 19
1.   A company that uses the perpetual inventory system sold $1,000 of goods to a customer on account. Which of the following journal entries correctly records the Sales revenue?

A.   Cost of goods sold 1,000
Sales revenue 1,000

B.   Inventory 1,000
Cost of goods sold 1,000

C.   Accounts receivable 1,000
Cash 1,000

D.   Accounts receivable 1,000
Sales revenue 1,000

QUESTION 20
1.   Which of the following inventory costing methods yields the highest gross
profit when costs are rising during the accounting period?

A.   Specific-unit-cost

B.   First-In, First-Out

C.   Average-cost

D.   Last-In, First-Out

Explanation / Answer

C.    $425,000 As per Chegg guidelines we answer one question per post but I have answered more than 1 Question Statement showing computations Particulars Amount Sales revenue      460,000.00 Sales Discounts      (20,000.00) Sales returns and allowances      (15,000.00) Net Sales Revenue      425,000.00 Q12 D.    Materiality concept Q13 D.    First-In, First-Out Q15   C.    $66,000 Statement showing computations Particulars Amount Sales revenue      180,000.00 Gross profit in % 60% COGS 1-60% 40% COGS in $ = 180000*40%         72,000.00 Beginning Inventory         28,000.00 Purchases      110,000.00 Cost of goods available for sale = 28000 +110000      138,000.00 Less COGS         72,000.00 Ending inventory = 138,000 - 72,000         66,000.00

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