Date Accounts and Explanation Debit Credit a. Merchandise Inventory XXX Accounts Receivable XXX b. Accounts Payable XXX Merchandise Inventory XXX C. Merchandise Inventory XXX Accounts Payable XXX d. Merchandise Inventory XXX Cash XXX

Date Accounts and Explanation Debit Credit a. Merchandise Inventory XXX Accounts Receivable XXX b. Accounts Payable XXX Merchandise Inventory XXX C. Merchandise Inventory XXX Accounts Payable XXX d. Merchandise Inventory XXX Cash XXX

Name: The journal entry for the purchase of inventory on account using the p
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Description: The journal entry for the purchase of inventory on account using the perpetual inventory system is DateAccounts and ExplanationDebitCredita.Merchandise InventoryXXXAccounts ReceivableXXXb.Accounts PayableXXXMerchandise InventoryXXXC.Merchandise Inven

Principles of Accounting Volume 1

19th Edition

ISBN:9781947172685

Author:OpenStax

Publisher:OpenStax

Chapter6: Merchandising Transactions

Section: Chapter Questions

Problem 9MC: Which of the following accounts are used when recording a purchase? A. cash, merchandise inventory...

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Which of the following accounts are used when recording the sales entry of a sale on credit? A. merchandise inventory, cash B. accounts receivable, merchandise inventory C. accounts receivable, sales D. sales, cost of goods sold
Which of the following accounts are used when recording a purchase? A. cash, merchandise inventory B. accounts payable, merchandise inventory C. A or B D. cash, accounts payable
On which financial statement would the merchandise inventory account appear? A. balance sheet B. income statement C. both balance sheet and income statement D. neither balance sheet nor income statement
Which of the following is an example of a contra revenue account? A. sales B. merchandise inventory C. sales discounts D. accounts payable
Identify items missing in determining cost of goods sold For (a) through (e), identify the items designated by X and Y. A. Purchases (X + Y) = Net purchases B. Net purchases + X = Cost of inventory purchased C. Inventory (beginning) + Cost of inventory purchased = X D. Inventory available for sale X = Cost of inventory before estimated returns E. Cost of goods sold before estimated returns X = Cost of goods sold
Perpetual and Periodic Inventory Systems Below is a list of inventory systems options. a. Perpetual inventory system b. Periodic inventory system c. Both perpetual and periodic inventory systems Required: Match each option with one of the following: 1. Only revenue is recorded as sales are made during the period; the cost of goods sold is recorded at the end of the period. 2. Cost of goods sold is determined as each sale is made. 3. Inventory purchases are recorded in an inventory account. 4. Inventory purchases are recorded in a purchases account. 5. Cost of goods sold is determined only at the end of the period by subtracting the cost of ending inventory from the cost of goods available for sale. 6. Both revenue and cost of goods sold are recorded during the period as sales are made. 7. The inventory is verified by a physical count.
Under the perpetual inventory system, how does the seller record sales made on account?
Merchandise Accounting Merchandise Inventory Raw materials Work in process Finished goods Gross profit Net sales Sales revenue Cost of goods available for sale Cost of goods sold Perpetual system Periodic system Transportation-In Purchases FOB destination point FOB shipping point Gross profit ratio An adjunct account used to record freight costs paid by the buyer. A system in which the Inventory account is increased at the time of each purchase and decreased at the time of each sale. Terms that require the seller to pay for the cost of shipping the merchandise to the buyer. Terms that require the buyer to pay for the shipping costs. A system in which the Inventory account is updated only at the end of the period. Beginning inventory plus cost of goods purchased. An account used in a periodic inventory system to record acquisitions of merchandise. Sales revenue less sales returns and allowances and sales discounts. Cost of goods available for sale minus ending inventory. Gross profit divided by net sales. Net sales less cost of goods sold. The cost of unfinished products in a manufacturing company. The account wholesalers and retailers use to report inventory held for sale. The inventory of a manufacturer before the addition of any direct labor or manufacturing overhead. A manufacturers inventory that is complete and ready for sale. A representation of the inflow of assets from the sale of a product.
The difference between merchandise available for sale and the end-of-period merchandise inventory is called (a) gross profit. (b) net purchases. (c) net sales. (d) cost of goods sold.
Rules of debit and credit for periodic inventory accounts Complete the following table by indicating for (a) through (g) whether the proper answer is debit or credit: Account Increase Decrease Normal Balance Purchases debit (a) (b) Purchases Discounts credit (c) credit Purchases Returns and Allowances (d) (e) (f) Freight In debit (g) debit
For each of the following accounts, identify whether the normal balance is a debit or a credit. Also specify whether the account is a contra account. a. Sales Returns and Allowances b. Merchandise Inventory c. Sales d. d Freight In e. Purchases Returns and Allowances f. Sales Tax Payable g. Purchases
Inventory Costing: LIFO Refer to the information for Filimonov Inc. and assume that the company uses a perpetual inventory system. Required: Calculate the cost of goods sold and the cost of ending inventory using the LIFO inventory costing method.