Not a member of Pastebin yet?
Sign Up,
it unlocks many cool features!
- Download: http://solutionzip.com/downloads/20-mcq-which-amount-does-not-change-during-the-period/
- 1. Which amount does not change during the period and is added to purchases when computing the cost of goods available for sale?
- A. Beginning inventory
- B. Ending inventory
- C. Periodic inventory
- D. Freight-in
- 2. The Allowance for Doubtful Accounts is adjusted
- A. at the end of each accounting period.
- B. each time a customer’s debt is satisfied.
- C. within one year of granting credit to a customer.
- D. each time a customer is granted credit.
- 3. The goods a company has available to sell to customers are called
- A. supplies.
- B. sales.
- C. cost of goods sold.
- D. merchandise inventory.
- 4. Net realizable value can be defined as the
- A. Gross Accounts Receivable.
- B. Current Bad Debts Expense.
- C. amount of Accounts Receivable you don’t expect to collect.
- D. Gross Accounts Receivable minus the Allowance for Doubtful Accounts.
- 5. At the start of the year, Northern Lights had $8,000 worth of merchandise. What do we know about Northern Lights?
- A. It’s a service business.
- B. It’s a retail business.
- C. The company ended with a net income last year.
- D. The company ended with a net loss last year.
- 6. Under the allowance method, Bad Debt Expense is recorded
- A. as an estimate.
- B. when an individual account is written off.
- C. several times during the year as needed.
- D. None of the above
- 7. Fit City estimates it will collect $2,300 of the $2,425 owed by customers. The difference of $125 represents the
- A. Gross Accounts Receivable.
- B. Allowance for Doubtful Accounts.
- C. Net Realizable Value.
- D. Value of the Current Unpaid Receivables.
- 8. Gross Accounts Receivable is $10,000. Allowance for Doubtful Accounts has a credit balance of $200. Net sales for the year are $150,000. In the past, 2% of sales had proved uncollectible. What would be the adjusted balance of the Allowance account under the income statement approach?
- A. $3,200
- B. $2,800
- C. $1,400
- D. $3,000
- 9. Harry’s Hardware estimates that approximately $1.75 out of every $100 of credit sales proves to be uncollectible. Barber calculates Bad-Debts Expense using the
- A. income statement approach.
- B. direct write-off method.
- C. balance sheet approach.
- D. aging the Accounts Receivable approach.
- 10. The physical count of inventory was incorrect; it overstated the ending inventory. This would cause the
- A. cost of goods sold to be overstated.
- B. cost of goods sold to be understated.
- C. gross profit to be understated.
- D. net income to be understated.
- 11. On December 31, 2012, Brooke’s Horse Stable’s unadjusted Allowance for Doubtful Accounts showed a debit balance of $432. An aging of the Accounts Receivable indicates probable uncollectible accounts of $1,000. The year-end adjusting entry for Bad-Debts Expense includes a
- A. debit to the Allowance account for $568.
- B. credit to the Allowance account for $42.
- C. debit to the Allowance account for $822.
- D. credit to the Allowance account for $1,432.
- 12. Using the aging method, estimated uncollectible accounts are $3,000. If the balance in the Allowance for Doubtful Accounts is a $600 credit before adjustment, what is the Bad-Debts Expense adjustment for the period?
- A. $3,000
- B. $600
- C. $2,400
- D. $3,600
- 13. The beginning Merchandise Inventory account appears in the _______ on the worksheet.
- A. adjustment column
- B. trial balance and the balance sheet columns
- C. trial balance and adjustment columns
- D. All of the above
- 14. Cost of goods sold equals
- A. beginning inventory + net purchases + freight-in + ending inventory.
- B. beginning inventory – net purchases – freight-in + ending inventory.
- C. beginning inventory + net purchases + freight-in – ending inventory.
- D. beginning inventory – net purchases + freight-in + ending inventory.
- 15. Indy Sport and Hobby’s Allowance for Doubtful Accounts had an unadjusted credit balance of $400. The manager estimates that $900 of the Accounts Receivable is uncollectible. Using the balance sheet approach, the year-end adjusting entry for Bad-Debts Expense includes a
- A. credit to the Bad-Debt Expense account for $500.
- B. debit to the Bad-Debts Expense account for $900.
- C. credit to the Bad-Debts Expense account for $1,300.
- D. debit to the Bad-Debts Expense account for $500.
- 16. Which method uses an aging of Accounts Receivable to calculate the Bad-Debts Expense?
- A. Income statement approach
- B. Balance sheet approach
- C. Aging the Accounts Receivable
- D. Direct write-off
- 17. An account never used in a service business is
- A. Consulting Fees-Revenue.
- B. Interest Payable.
- C. Merchandise Inventory.
- D. Accumulated Depreciation–Equipment.
- 18. Gross Accounts Receivable is $12,000. Allowance for Doubtful Accounts has a credit balance of $600. Net sales for the year are $100,000. In the past, 2% of sales had proved uncollectible, and an aging of the receivables indicates $1,900 as uncollectible. What would be the adjusted balance of the Allowance account under the balance sheet approach?
- A. $2,000
- B. $1,400
- C. $2,500
- D. $1,900
- 19. Gross Accounts Receivable is $10,000. Allowance for Doubtful Accounts has a credit balance of $200. Net sales for the year are $150,000. In the past, 2% of sales had proved uncollectible, and an aging of the receivables indicates $1,200 is doubtful. Under the income statement approach, the Bad-Debts Expense for the year is
- A. $1,000.
- B. $3,000.
- C. $2,800.
- D. $1,200.
- 20. Beginning inventory was $4,000, purchases totaled $22,000, and sales were $20,000. What is the ending inventory?
- A. $2,000
- B. $4,000
- C. $6,000
- D. $8,000
- Download: http://solutionzip.com/downloads/20-mcq-which-amount-does-not-change-during-the-period/
Add Comment
Please, Sign In to add comment