Question 1 When the perpetual inventory system is used, the Cost of Sales is: always equal to the cost of ending inventory. recorded when there is a purchase of merchandise. recorded when there is a sale of merchandise. determined only after the physical count of inventory is counted. Question 2 Which of the following is not included in determining Gross Profit? beginning inventory operating expense purchases sales Question 3 The company made purchases of P60,000 and sales of P85,000 with P10,000 left in inventory. If the company has no beginning inventory, how much is the cost of sales? P75,000 P50,000 P70,000 P60,000 Question 4 The co
The Effect Of Prepaid Taxes On Assets And Liabilities
Many businesses estimate tax liability and make payments throughout the year (often quarterly). When a company overestimates its tax liability, this results in the business paying a prepaid tax. Prepaid taxes will be reversed within one year but can result in prepaid assets and liabilities.
Final Accounts
Financial accounting is one of the branches of accounting in which the transactions arising in the business over a particular period are recorded.
Ledger Posting
A ledger is an account that provides information on all the transactions that have taken place during a particular period. It is also known as General Ledger. For example, your bank account statement is a general ledger that gives information about the amount paid/debited or received/ credited from your bank account over some time.
Trial Balance and Final Accounts
In accounting we start with recording transaction with journal entries then we make separate ledger account for each type of transaction. It is very necessary to check and verify that the transaction transferred to ledgers from the journal are accurately recorded or not. Trial balance helps in this. Trial balance helps to check the accuracy of posting the ledger accounts. It helps the accountant to assist in preparing final accounts. It also helps the accountant to check whether all the debits and credits of items are recorded and posted accurately. Like in a balance sheet debit and credit side should be equal, similarly in trial balance debit balance and credit balance should tally.
Adjustment Entries
At the end of every accounting period Adjustment Entries are made in order to adjust the accounts precisely replicate the expenses and revenue of the current period. It is also known as end of period adjustment. It can also be referred as financial reporting that corrects the errors made previously in the accounting period. The basic characteristics of every adjustment entry is that it affects at least one real account and one nominal account.
Question 1
When the perpetual inventory system is used, the Cost of Sales is:
always equal to the cost of ending inventory.
recorded when there is a purchase of merchandise.
recorded when there is a sale of merchandise.
determined only after the physical count of inventory is counted.
Question 2
Which of the following is not included in determining Gross Profit?
beginning inventory
operating expense
purchases
sales
Question 3
The company made purchases of P60,000 and sales of P85,000 with P10,000 left in inventory. If the company has no beginning inventory, how much is the cost of sales?
P75,000
P50,000
P70,000
P60,000
Question 4
The company made purchases of P60,000 and sales of P85,000 with P10,000 left in inventory. If the company has a beginning inventory of P25,000, how much is the gross profit?
P30,000
P10,000
P25,000
P20,000
Question 5
Which of the following could appear on the income statement of both a merchandise and a service type of business?
gross profit
sales
cost of sales
salaries expense
Question 6
Net profit will result if:
sales exceed cost of sales
the cost of sales exceeds operating expenses
sales exceed operating expenses
gross profit exceeds operating expenses
Question 7
Gross profit for a merchandising entity is net sales minus:
expenses
cost of sales
cost of goods available for sale
sales discounts
Question 8
The
a credit to Sales
a debit to Income Summary
a credit to Purchases
a debit to Merchandise Inventory
Question 9
The merchandise left on hand and unsold at the end of the period is the:
beginning inventory
cost of sales
purchases
ending inventory
Question 10
All of the following are included in the computation of the cost of sales except:
sales
beginning inventory
ending inventory
Purchases
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