accounting test 2

Question 1

Elfland Toys purchased $164,800 worth of Pega Block toys on account with credit terms 60.2/10, n/60.

Answer 1

debit: merchandise inventory 164,800
credit: accounts payable-Eland Toys 164,800

Question 2

Toys and More returned $11,250 of the merchandise to MegoBlock due to damage during shipment.

Answer 2

debit: accounts payable- Toys and More 11250
credit: merchandise inventory 11250

Question 3

Toys and More paid the amount​ due, less the return and discount.
- purchased $113,300
- returned $11,250

Answer 3

debit: Accounts Payable- Toys and More. 102050
credit: Cash 100009
credit: merchandise inventory 2041

Question 4

Burlington paid a $ 50 freight charge

Answer 4

debit: merchandise inventory 50
credit: cash 50

Question 5

Oct. ​10: Piranha.comPiranha.com sells 3,500 books on account for $17 each on October 10 to The Textbook Store. Record the transaction on the books of The Textbook Store

Answer 5

debit: merchandise inventory 59500
credit: accounts payable 59500

Question 6

Several books were slightly damaged in​ shipment, so Piranha.com granted a sales allowance of $1,000 to The Textbook Store. Record the transaction on the books of The Textbook Store.

Answer 6

debit: accounts payable- piranha.com 1000
credit: merchandise inventory 1000

Question 7

gross profit percentage

Answer 7

Gross Profit (net sales revenue-cost of goods sold)/ net sales revenue

Question 8

Paid freight​ charges, $ 400

Answer 8

debit: merchandise inventory 400
credit: cash 400

Question 9

Returned $ 600 of inventory to Sanders

Answer 9

debit: accounts payable- sanders 600
credit: merchandise inventory 600

Question 10

Paid Sanders ​Diamonds, less return

Answer 10

debit: accounts payable
credit: merchandise inventory

Question 11

Purchased inventory of $3,500 on account from Southboro​Diamonds, a jewelry importer. Terms were 22​/10, ​n/EOM, FOB destination

Answer 11

debit: merchandise inventory
credit: accounts payable- southboro diamonds

Question 12

Received a $ 300 allowance from Southboro Diamonds for damaged but usable goods

Answer 12

debit: accounts payable- southboro diamonds 300
credit: merchandise inventory 300

Question 13

Paid Southboro ​Diamonds, less allowance and discount

Answer 13

debit: accounts payable
credit: merchandise inventory
credit: cash

Question 14

merchandise inventory is a…

Answer 14

is a current asset

Question 15

Cost of Goods sold is a..

Answer 15

expense, debit increases it

Question 16

gross profit

Answer 16

net revenue- cost of goods sold

Question 17

Jan. 4​: Sold $16,000 of antiques on​ account, credit terms are​ n/30, to Cavalli Designs. Cost of goods is $8,000.
Begin by preparing the entry to journalize the sale portion of the transaction. Do not record the expense related to the sale.

Answer 17

debit: accounts receivable- Cavailli Designs 16000
credit; sales revenue- 16000

Question 18

Now journalize the expense related to the January 4 sale long —Cost of​ goods, $8,000.

Answer 18

debit: cost of goods sold- 8000
credit: merchandise inventory- 8000

Question 19

Jan. 8​: Received a $ 300 sales return on damaged goods from Cavalli Designs. Cost of goods damaged is $ 150
Start by preparing the entry to record the sales return and decrease the receivable. Do not update the Merchandise Inventory with this entry. We will do that in the following step.

Answer 19

debit: refunds payable. 300
credit: accounts receivable- Cavalli Designs 300

Question 20

Now prepare the entry to update the Merchandise Inventory account for the cost of the returned merchandise —cost of goods​ returned, $150

Answer 20

debit: merchandise inventory 150
credit: estimated returns inventory 150

Question 21

Antique Mall paid $ 70 on freight out to White Furniture.

Answer 21

debit: delivery expense 70
credit: cash 70

Question 22

in fifo when do you subtracted the amount from the top inventory

Answer 22

when its cost of goods sold

Question 23

in fifo what do we do for the totals

Answer 23

add them all together

Question 24

FIFO rules

Answer 24

• keep the first one and keep substring it from cost of goods sold and keep it.
• if you add to purchases you continuing to add to inventory
• will change when you get a COGS

Question 25

LIFO method rules

Answer 25

- add the last inventory to cost of goods sold then use requirements and subtract that from last inventory. then take that and subtract from the first inventory to put it in the inventory on hand. - it will change when you get a COGS

Question 26

weighted average cost method rules

Answer 26

- will take second purchases add the first inventory and total cost - divide total cost by quantity to get the unit cost for inventory on hand - keep subtracting inventory on hand by cost of goods sold to get new inventory on hand - the inventory will change when you get new purchases

Question 27

Begin by recording the entry to record the sale of the putters on account on the 6th quantity- 20, unit cost-53, The sales price of each putter is $ 119

Answer 27

debit: accounts receivable 2380 credit:sales revenue 2380

Question 28

Now record the cost of the putters sold on the 6th.

Answer 28

debit: COGS 1060 credit: merchandise inventory 1060

Question 29

Journalize the purchase of the putters on account on the 8th 8th journal: quantity-30, unit cost-70, total cost-2100

Answer 29

debit: merchandise inventory 2100 credit: accounts payable 2100

Question 30

Journalize the sale of the putters on account on the 17th quantity- 30, unit cost-70, The sales price of each putter is $ 119

Answer 30

debit; Accounts receivable credit: sales revenue

Question 31

Journalize the cost of the putters sold on the 17th.

Answer 31

debit: COGS credit; merchandise inventory

Question 32

Journalize the sale of the putters on account on the 30th. quantity- 20, unit cost- 70, The sales price of each putter is $ 119

Answer 32

debit: accounts receivable credit: sales revenue

Question 33

Journalize the cost of the putters sold on the 30th

Answer 33

debit: COGS credit: merchandise inventory

Question 34

inventory turnover rate

Answer 34

cost of goods sold/ average inventory rate

Question 35

days sale inventory

Answer 35

365/average inventory rate

Question 36

Begin with the EFT collection

Answer 36

debit: cash credit: rent revenue

Question 37

Journalize the entry to correct the error.

Answer 37

debit: salaries expense credit: cash

Question 38

Journalize the adjustment for the NSF check

Answer 38

debit: accounts receivable credit; cash

Question 39

Journalize the charge for printed checks

Answer 39

debit; bank expense credit; cash

Question 40

Journalize the service charges

Answer 40

debit: bank expense credit: cash

Question 41

Journalize the creation of the fund.   

Answer 41

debit; petty cash credit; cash

Question 42

Journalize the replenishment of the fund

Answer 42

debit; expenses cash short and over credit; cash

Question 43

Make the entry on JulyJuly 1 to increase the fund balance to $ 325$325.

Answer 43

debit: petty. (difference of when you created cash and new) credit: cash

Question 44

An imprest fund has ______ balance at all​ times, which equals the sum of _______ accounts receivable cash in the bank cash in the fund deposits in transit plus the ________ that support payments from the fund. The internal control feature of an imprest fund is that it _____ the amount of money for which the fund custodian is responsible.

Answer 44

the same, cash in the fund, total of tickets, clearly identify

Question 45

Use the direct​ write-off method to journalize KnollKnoll​'s ​write-off of the uncollectible receivables At April 30 2024​, Knoll accounts receivable totaled $23,000. During May​, she earned revenue of $25,000 on account and collected $22,000 on account. She also wrote off uncollectible receivables of $2,500 on May 31​, 2024

Answer 45

debit; bad debt expense 2500 credit; accounts receivable 2500

Question 46

Noel sent a $ 750 check to Gate City Cycles Cycles. Start by journalizing the entry to reverse the earlier​ write-off.

Answer 46

debit accounts receivable credit; bad debt expense

Question 47

On June2024​, Gate City Cycles wrote off Noel's $750 account receivable. Journalize the entry

Answer 47

debit: bad debt expense credit: accounts receivable

Question 48

Now journalize the cash collection

Answer 48

debit: cash credit: accounts receivable

Question 49

Sales revenue on​ account, $276,000 ​(ignore Cost of Goods​ Sold).

Answer 49

debit; accounts receivable credit: sales revenue

Question 50

​Write-offs of​ uncollectibles, 6100 for allowance method

Answer 50

debit: allowance for bad debts credit: accounts receivable

Question 51

Bad debts expense of $6,000 was recorded.

Answer 51

debit: bad debts expense credit: allowance for bad debt

Question 52

Journalize Spring's Bad Debts Expense using the​ percent-of-sales method.

Answer 52

debit: bad debt expense credit; allowance for bad debts

Question 53

Assume Clark had an unadjusted$1,800 credit balance in Allowance for Bad Debts at December ​31, 2024. Journalize Clark​'s December ​31,2024​, adjustment to record bad debts expense using the​ percent-of-receivables method. The Accounts Receivable balance for Clark​, Inc. at December​ 31, 2023​, was $26,000. During 2024​, Clark earned revenue of $455,000 on account and collected $322,000 on account. Clark wrote off $5,700 receivables as uncollectible. Industry experience suggests that uncollectible accounts will amount to 4​% of accounts receivable.

Answer 53

debits: bad debt expense 4332 credits:allowance for bad debts 4332 26000+455000-322000-5700=153300 153300*.04=6,132 6,132-1800=4332

Question 54

Requirement 2. Assume ClarkClark had an unadjusted $1,600 debit balance in Allowance for Bad Debts at December, 2024. Journalize ClarkClark​'s December 2024​, adjustment to record bad debts expense using the​ percent-of-receivables method. ​

Answer 54

debits: bad debt expense 7732 credits: allowance for bad debts 7732 26000+455000-322000-5700= 153300 153300*.04= 6,132 1632+ 1,600= 7732

Question 55

Journalize Worldwide's entry to record bad debts expense for 2024 using the​ aging-of-receivables method. allowance for bad debt: 1216 accounts receivable: 76000......3,000 estimated percent uncollectible: 4%.... 16%

Answer 55

debit: bad debt expense 2304 credit: allowance bad expense 2304