1. carter company sells merchandise on account for $3,000 to hannah

carter company sells merchandise on account

1.  Carter Company sells merchandise on account for $3,000 to Hannah Company with credit terms of 2/10, n/30. Hannah Company returns $450 of merchandise that was damaged, along with a check to settle the account within the discount period. What entry does Carter Company make upon receipt of the check?


Cash 2,550 Accounts Receivable 2,550

Cash 2,940 Sales Discounts 60 Sales Returns and Allowances 450 Accounts Receivable 2,550

Cash 2,499 Sales Returns and Allowances 501 Accounts Receivable 3,000

Cash 2,499 Sales Returns and Allowances 450 Sales Discounts 51 Accounts Receivable 3,000


2.  On November 2, 2012, Kasdan Company has cash sales of $4,500 from merchandise having a cost of $2,700. The entries to record the day’s cash sales will include:


a $2,700 credit to Cost of Goods Sold.

a $4,500 credit to Cash.

a $2,700 credit to Inventory.

a $4,500 debit to Accounts Receivable.


3.  Income from operations is gross profit less


operating expenses.

financing expenses.

other expenses and losses.

other expenses.


4.  If a company determines cost of goods sold each time a sale occurs, it


must have a computer accounting system.

uses a combination of the perpetual and periodic inventory systems.

uses a perpetual inventory system.

uses a periodic inventory system.


5.  The collection of a $800 account after the 2 percent discount period will result in a


debit to Cash for $784.

credit to Accounts Receivable for $800.

credit to Cash for $800.

debit to Sales Discounts for $16.


6.  When goods are returned that relate to a prior cash sale,


Sales Returns and Allowances will be credited.

the cash account will be credited.

Accounts Receivable will be credited.

the Sales Returns and Allowances account should not be used.


7.  Rae Company made a purchase of merchandise on credit from Tyree Corporation on August 3, for $7,000, terms 2/10, n/45. On August 10, Rae makes the appropriate payment to Tyree. The entry on August 10 for Rae Company is


Accounts Payable 7,000 Purchase Returns and Allowances 140 Cash 6,860

Accounts Payable 6,860 Cash 6,860

Accounts Payable 7,000 Inventory 140 Cash 6,860

Accounts Payable 7,000 Cash 7,000


8.  Indrisano’s Used Cars uses the specific identification method of costing inventory. During March, Indrisano purchased three cars for $6,000, $7,200, and $9,600, respectively. During March, two cars are sold for a total of $17,300. Indrisano determines that at March 31, the $7,200 car is still on hand. What is Indrisano’s gross profit for March?







9.  Which of the following statements is correct with respect to inventories?


The FIFO method assumes that the costs of the earliest goods acquired are the last to be sold.

Under FIFO, the ending inventory is based on the latest units purchased.

It is generally good business management to sell the most recently acquired goods first.

FIFO seldom coincides with the actual physical flow of inventory.


10.  Netta Shutters has the following inventory information. 

Nov. 1  Inventory 15 units @ $8.00

         8  Purchase 60 units @ $8.30 

       17  Purchase 30 units @ $8.40 

       25  Purchase 45 units @ $8.80


A physical count of merchandise inventory on November 30 reveals that there are 45 units on hand. Assume a periodic inventory system is used. Cost of goods sold (rounded to the nearest dollar) under the average-cost method is







11.  At May 1, 2013, Kibbee Company had beginning inventory consisting of 100 units with a unit cost of $7. During May, the company purchased inventory as follows: 400 units at $7 300 units at $8 The company sold 500 units during the month for $12 per unit. Kibbee uses the average cost method. The average cost per unit for May is







12.  The convergence issue that will be most difficult to resolve in the area of inventory accounting is:



ownership of goods.

costs to include in inventory.



13.  A company just starting in business purchased three merchandise inventory items at the following prices. First purchase $80; Second purchase $95; Third purchase $85. If the company sold two units for a total of $250 and used FIFO costing, the gross profit for the period would be







14.  GAAP defines market for lower-of-cost-or market essentially as


estimated selling price in the ordinary course of business.

net realizable value.

replacement cost.

replacement cost less costs of disposal.


15.  Partridge Bookstore had 500 units on hand at January 1, costing $18 each. Purchases and sales during the month of January were as follows: 


Date        Purchases           Sales 

Jan. 14                                375  @ $28 

        17     250 @ $20 

        25     250 @ $22 

        29                                 260 @ $32


Partridge does not maintain perpetual inventory records. According to a physical count, 365 units were on hand at January 31. The cost of the inventory at January 31, under the FIFO method is:






Calculate the price of your order

Select your paper details and see how much our professional writing services will cost.

We`ll send you the first draft for approval by at
Price: $36
  • Freebies
  • Format
  • Formatting (MLA, APA, Chicago, custom, etc.)
  • Title page & bibliography
  • 24/7 customer support
  • Amendments to your paper when they are needed
  • Chat with your writer
  • 275 word/double-spaced page
  • 12 point Arial/Times New Roman
  • Double, single, and custom spacing
  • We care about originality

    Our custom human-written papers from top essay writers are always free from plagiarism.

  • We protect your privacy

    Your data and payment info stay secured every time you get our help from an essay writer.

  • You control your money

    Your money is safe with us. If your plans change, you can get it sent back to your card.

How it works

  1. 1
    You give us the details
    Complete a brief order form to tell us what kind of paper you need.
  2. 2
    We find you a top writer
    One of the best experts in your discipline starts working on your essay.
  3. 3
    You get the paper done
    Enjoy writing that meets your demands and high academic standards!

Samples from our advanced writers

Check out some essay pieces from our best essay writers before your place an order. They will help you better understand what our service can do for you.

Get your own paper from top experts

Order now

Perks of our essay writing service

We offer more than just hand-crafted papers customized for you. Here are more of our greatest perks.

  • Swift delivery
    Our writing service can deliver your short and urgent papers in just 4 hours!
  • Professional touch
    We find you a pro writer who knows all the ins and outs of your subject.
  • Easy order placing/tracking
    Create a new order and check on its progress at any time in your dashboard.
  • Help with any kind of paper
    Need a PhD thesis, research project, or a two-page essay? For you, we can do it all.
  • Experts in 80+ subjects
    Our pro writers can help you with anything, from nursing to business studies.
  • Calculations and code
    We also do math, write code, and solve problems in 30+ STEM disciplines.

Frequently asked questions

Get instant answers to the questions that students ask most often.

See full FAQ
    See full FAQ

    Take your studies to the next level with our experienced specialists

    Hello, we are online 24/7. Leave a message we will reply instantly