Quiz 5 Flashcards

1
Q

A merchandiser earns profit by buying and selling merchandise

A

true

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2
Q

a service company earns profit by buying and selling merchandise

A

false

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3
Q

A wholesaler is a company that buys products from manufactures and sells them to consumers

A

false

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4
Q

a retailer is a middleman that buys products from manufacturers and sells them to wholesaler

A

false

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5
Q

gross profit is also called gross

A

true

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6
Q

Y-mart had sales of $350,000 its cost of goods sold was $200,00 its gross profit is $550,000

A

false

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7
Q

Y-mart has a net sales of $645,000 its cost of goods was $445,000 its gross margin was $200,000

A

true

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8
Q

Cost of goods sold is reported on both the income statement and the balance sheet

A

false

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9
Q

a perpetual inventory system gives a continuous record of the amount of inventory on hand

A

true

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10
Q

The terms 2/10, n/30 means that the seller offers the purchaser a 2% cash discount if the amount is paid in full within 10 days Otherwise the full amount is due in 30 days

A

true

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11
Q

for each sales transaction of a seller using a perpetual inventory system it recognizes revenue and cost of goods sold

A

true

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12
Q

A debit to sales Returns and Allowances and a credit to Accounts receivable means that a customer may have returned the merchandise

A

true

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13
Q

Sales of $350,000 and net sales of $323,000 may reflect sales discounts od $27,000

A

true

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14
Q

Transportation-in increases cost of goods purchased

A

true

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15
Q

Merchandising sales and costs reported on the income statement usually differ from cash receipts and payments for the period

A

true

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16
Q

a classified multiple-step income statement is a format that shows intermediate totals between sales and profit and detailed calculations of net sales and cost of goods sold

A

true

17
Q

businesses normally get a full credit for the goods and services tax (GST) and/or Harmonized sales tax (HST) that they have paid

A

true

18
Q

retailer

A

buys products from manufacturers and wholesalers and sell to consumers

19
Q

merchandise inventory is(are)

A

products a company owns for resale to customers

20
Q

2/10, n/30 is interpreted as

A

2% cash discount id the whole amount is paid within 10 days, the balance is due in 30 days

21
Q

sales returns and allowances

A

are usually recorded in separate contra-revenus accounts

22
Q

MicroAge sells cellphones at a selling price that includes a 65% markup on a cost. If a cellphone cost MicroAge $300 its selling price is

A

$495.00

23
Q

You work at a sporting goods store. You are considering adding baseball gloves and bats to your inventory What would be the selling price of baseball bats with a mark-up % of 85% (cost is $12) and the baseball gloves with a target gross margin of 60% (cost is $20)

A

selling price (bats) = $22.20 selling price (gloves) = $50

24
Q

The agreed cost of an item to be purchased by a business on credit is $4,000 the applicable cost will be debited to advertising expense. The item is subject to 5% goods and services tax (GST) and 7% provincial sales tax (PST) When this transaction is recorded, what amount will be credited to accounts payable

A

$4480

25
Q

A business sold some inventory that has cost $5,000 before taxes The sale is subject to 5% goods and services tex (GST) and 7% provincial sales tax (PST) the business uses a perpetual inventory account as a result of this sale

A

$5,000