Q 5.3: In a inventory system, the cost of goods is determined only at the end of the accounting period Q 5.4: A company receives a discount for paying for merchandise purchased within the discount period. How will the amount of the discount be recorded in a perpetual inventory system? Q 5.5: What does the freight term“ FOB destination” mean? Q 5.6: A retailer acquires merchandise for resale. How would this be recorded in a perpetual inventory system? Q 5.7: If the credit terms on a sales invoice read“ 2 / 10, n / 30,” what does this mean? Q 5.8: In which of the following scenarios would a Sales and Returns and Allowances account NOT be debited? Q 5.9: ________ has a normal credit balance. Q 5.10: Which of the following is NOT a contra revenue account? Q 5.11: In a perpetual inventory system, when is the Cost of Goods Sold account used? Q 5.12: ________ is shown on a multiple-step but not on a single-step income statement. Q 5.13: Why might a company choose to use the single-step income statement? Select all that apply. Q 5.14: At the beginning of January 2014, a company reported inventory of $ 4,000. During the month, the company made purchases of $ 17,800. On January 31, 2014, a physical count of inventory reported $ 4,200 on hand. Find the cost of goods sold for the month. Q 5.15: ________ requires a physical count of goods on hand to compute the cost of goods sold. Q 5.16: During the year, a company’ s inventory decreased by $ 20,000. If the company’ s cost of goods sold for the year was $ 400,000, find the amount for purchases. Q 5.17: How is the gross profit rate computed Q 5.18: How is the profit margin computed? Q 5.19: How is the quality of earnings ratio computed? Q 5.20: How do you calculate the cost of goods for sale if closing inventory is nil?
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