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5 Written questions

3 Matching questions

  1. Which of the following accounts will normally appear in the ledger of a merchandising company that uses a perpetual inventory system?
    A. Purchases.
    B. Freight-in.
    C. Cost of Goods Sold.
    D. Purchase Discounts.
  2. The following amounts relate to Amato Company for the current year: Beginning Inventory, $20,000; Ending Inventory, $28,000; Purchases, $166,000; Purchase Returns, $4,800; and Freight-Out, $6,000. The amount of Cost of Goods Sold for the period is
    A. $159,200.
    B. $169,200.
    C. $162,800.
    D. $153,200.
  3. If Sales Revenue is $400,000, Cost of Goods Sold is $310,000, and Operating expenses are $60,000, the Gross profit is
    A. $30,000.
    B. $90,000.
    C. $340,000.
    D. $400,000.
  1. a C
  2. b B
  3. c D

5 Multiple choice questions

  1. D
  2. B
  3. C
  4. False
  5. A

5 True/False questions

  1. Income from operations appears on
    A. both a multiple-step and a single-step income statement.
    B. neither a multiple-step nor a single-step income statement.
    C. a multiple-step income statement only.
    D. a single-step income statement only.


  2. A perpetual inventory system would more likely be used by a (n)
    A. automobile dealership.
    B. hardware store.
    C. drugstore.
    D. convenience store.


  3. Cost of goods available for sale is computed by adding
    A. inventory to ending inventory.
    B. beginning inventory to the cost of goods purchased.
    C. purchases and freight-in.
    D. purchases to purchases discounts and freight-in.


  4. All of the following are contra revenue accounts except
    A. Sales Revenue.
    B. Sales Allowances.
    C. Sales Discounts.
    D. Sales Returns.


  5. The account Sales Discounts is a(n)
    A. revenue account.
    B. contra revenue account.
    C. liability account.
    D. expense account.