Answered: 1. One of the assessments made in…

Business

Finance

1. One of the assessments made in credit sales is unwillingness to pay, please explain what is meant by that term?

Principles of Accounting Volume 1

19th Edition

ISBN:9781947172685

Author:OpenStax

Publisher:OpenStax

Chapter6: Merchandising Transactions

Section: Chapter Questions

Problem 1MC: Which of the following is an example of a contra revenue account? A. sales B. merchandise inventory...

See similar textbooks

Related questions

Q: Compute the ending inventory and the cost of goods sold under the LIFO cost flow assumption assuming…

A: LIFO is last in first out method in which inventories which are purchased in last will be sold out…

Q: 1. Cost of goods sold + ending inventory equals?

A: We’ll answer the first question since the exact one wasn’t specified. Please submit a new question…

Q: How can you identify possible causes for the out of balance amount if "Sales Detail Report" and…

A: When you view the reports they can identify possible causes for the out of balance amount.There are…

Q: der the periodic inventory system, all increases and decreases in inventory, such as purchases,…

A: Solution: False. Under periodic inventory system Daily inventory records are not maintained.

Q: A company records inventory at gross invoice price. Theoretically, how should the following affect…

A: Solution: Interest on inventory loan do not affect cost of inventory, it is working capital loan…

Q: Indicate whether the following statements are true or false. 1. A merchandising company reports…

A: 1) This statement is True. As Service Based Companies do not sell the products so there Income…

Q: 3. Indicate the effect of the following errors on gross profit and cost of goods sold (COGS), i.e.,…

A: Solution Concepts Purchase account is an expense and if it is understated profit will increase and…

Q: Under the perpetual inventory system, increases and decreases in inventory are recorded through the…

A: Solution: Under perpetual inventory system, inventory records are updated with every purchase and…

Q: Ethics within inventory estimates and other creative accounting methods. Channel stuffing, swaps,…

A: Ethics implies the arrangement of rules that the association ought to follow. While in business,…

Q: T, F. Under the GAAP rule, inventories can be reported at above cost in the balance sheet. T, F. If…

A: Under GAAP rules , inventory is valued at cost or net realizable value which ever is lower due to…

Q: A company using a perpetual inventory system that returns goods previously purchased on credit would…

A: What is perpetual inventory system? It is a system which record the changes in inventory(purchased…

Q: What type of account is Merchandise Inventory and on which financial statement is it found? Does it…

A: Merchandise inventory means goods or stock that the business has in its books or in its stock. This…

Q: 1, how can assets and liabilities be classified for a more informative balance sheet?

A: Introduction :- A classified balance sheet is a financial statement with classifications like…

Q: Debiting "Inventory" always results a credit of cash O True O False

A: Inventory is a current asset that appears on the statement of financial position of a company. It…

Q: Management is prone to overstate: a. accounts receivable and inventory. b. accounts…

A: The sum shown on the financial statement is higher than it should have been if accounts or a number…

Q: Under the perpetual inventory system, cost of goods sold is debited when inventory is sold and…

A: Solution: Under perpetual inventory system, inventory is updated with every purchase and sales. Cost…

Q: What is the treatment of the following items in connection with the retail inventory method? g.…

A: Retail inventory method : The retail inventory method is the accounting method for estimation of the…

Q: Which statements below are true? 1. LCM and LCNRV may be applied by individual products, by…

Q: A company using a perpetual inventory system that returns goods previously purchased on credit would…

A: A company using a perpetual inventory system that returns goods previously purchased on credit would…

Q: How can accounting keep up with the rising sales return rates, especially when it comes to inventory…

A: Management of inventories: Inventory management may be characterized as a system for measuring and…

Q: Required: 1. Prepare the income statements to reflect the correct amounts, taking into consideration…

A: Overstatement of ending inventory will reduce the cost of goods sold and also increase the opening…

Q: Explain what is meant by the cost rule or net realizable value, whichever is less, and how it is…

A: As per IAS -02 inventory should be measured on cost or Net realizable value whichever is lower.…

Q: As shown below: an accountant has debited the Inventory account for $65,000 and credited the…

A: The journal entries are prepared to keep the record of day to day transactions of the business.

Q: Which of the following statement is FALSE for Merchandise inventory of the Business? a. It is a…

A: Merchandise inventory is classified as a current asset on the balance sheet. Assets normally have a…

Q: B-Marts' large proportion of merchandise held on consignment from suppliers. Which account balance…

A: Audit is the process of checking and verifying books of account of the business in order to ensure…

Q: 48. Which of the following statements is incorrect about perpetual inventory system? a. Inventory…

A: Inventory is the current asset for the company that is reported under the head current asset in the…

Q: 3.Which of the following transactions would not result in an adjustment to the inventory account…

A: Perpetual inventory system is the one in which the record relating to the inventory is to be…

Q: 1. Before inventory purchases are recorded, the receiving report should be reconciled to what…

A: Inventory: Inventory refers to the raw materials, work in progress, and finished goods that are held…

Q: What would you do, and how would you document your decision?

A: Given case is: You have Noticed that the A/R clerk has created abnormally high number of credit…

Q: Allowance Method in accounting for inventory write-down

A: Statement I is correct because Allowance method is required to be followed in accounting for…

Q: i) Explain the main causes of inventory decreasing and increasing. (ii) What is the accounting…

A: Hello. Since your question has multiple parts, we will solve the first question for you. If you want…

Q: Which of the following is not a step in the retail inventory method process? a.Compute the cost of…

A: The question is based on the concept of Cost Accounting.

Q: 3. Indicate the effect of the following errors on gross profit and cost of goods sold (COGS), i.e.,…

A: Cost of goods sold (COGS)- The cost incurred on the goods sold during the period is referred to as…

Q: Which of the following statements is true for a company that uses a periodic inventory system?…

A: Only inventory account is used for all the inventory transactions in the perpetual inventory system.…

Question

1. One of the assessments made in credit sales is unwillingness to pay, please explain what is meant by that term?

2. What is the inventory stability method?

*I NEED THIS ASAP, PLEASE HELP THANKS!

Expert Solution

This question has been solved!

Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.

SEE SOLUTION Check out a sample Q&A here

Step 1

VIEW

Step 2

VIEW

Step 3

VIEW

Step by step

Solved in 3 steps

SEE SOLUTION Check out a sample Q&A here

Similar questions

Which of the following is a disadvantage of the perpetual inventory system? A. Inventory information is in real-time. B. Inventory is automatically updated. C. It allows managers to make current decisions about purchases, stock, and sales. D. It is cost-prohibitive.
Using the perpetual inventory system, what account is debited when a business finds that its physical count of inventory is greater than the recorded amount?
Which of the following is an example of a contra revenue account? A. sales B. merchandise inventory C. sales discounts D. accounts payable
Which of the following is an advantage of the periodic inventory system? A. frequent physical inventory counts B. cost prohibitive C. time consuming D. real-time information for managers
A company is trying to set up proper internal controls for their accounts payable/inventory purchasing system. Currently the purchase order is generated by the same person who receives the inventory. Together the purchase order and the receiving ticket are sent to accounts payable for payment. What changes would you make to improve the internal control structure? A. No changes would be made since the person paying the bills is different from the person ordering the inventory. B. The person in accounts payable should generate the purchase order. C. The person in accounts payable should generate the receiving ticket once the invoice from the supplier is received. D. The responsibilities of generating the purchase order and receiving the inventory should be separated among two different people.
Which one of the following statements is true regarding the cost of sales, if the perpetual inventory control system is in use? Select one: a. If goods are sold for cash or on credit, the cost of sales will decrease on the debit side. b. Under the perpetual inventory control system, there is no cost of sales. Therefore, the cost of sales is not affected. c. If goods are sold for cash or on credit, the cost of sales will increase on the debit side. d. If goods are sold for cash or on credit, the cost of sales will increase on the credit side.
You have Noticed that the A/R clerk has created abnormally high number of credit memos . You also notice the inventory does not reflect the additional inventory resulting from the sales returns. What would you do, and how would you document your decision?
3.Which of the following transactions would not result in an adjustment to the inventory account under a perpetual inventory system? A)The return of merchandise by a customer. B)The sale of merchandise for cash. C)The sale of merchandise on credit. D)The receipt of payment from a customer within the discount period.
A company using a perpetual inventory system that returns goods previously purchased on credit would 1. debit Accounts Payable and credit Inventory. 2. debit Accounts Payable and credit Purchases. why is it credit inventory instead of purchases? In other words I know the answer is 1 but why?
1, how can assets and liabilities be classified for a more informative balance sheet? 2, what are reversing entries and how do we record them? 3, are there different methods used to account for perpetual inventory? 4, what are the effects of two of the different methods? 5, what happens if inventory declines in value? 6, how can we estimate inventory if there is a fire? 7, what are some guidelines for accounting and why do we need them? 8, how do business transactions affect the accounting records of a company?
If an accounting manager asks you to delay recording an invoice for the purchase of merchandise until after the closing of the general ledger, but include the merchandise in the physical count of the ending merchandise inventory (periodic inventory method), the manager is attempting to do which of the following? a. Follow the matching principle b. Increase the reported net income in the income statement of the current period c. Employ the cost method of recording purchases d. Take advantage of the credit terms related to the purchase
Which of the following transactions would not result in an adjustment to the inventory account under a perpetual inventory system? a.The sale of merchandise for cash b.The sale of merchandise on credit c.The receipt of payment from a customer within the discount period d.The return of merchandise by a customer