ACNT1 Merchandising Businesses and Inventories 5.3.3

​How does a merchandising business differ from a service provider?

• ​Merchandisers primarily sell goods.

• ​Service providers are tax exempt.

• ​Merchandisers sell only to wholesalers.

• ​Service providers primarily sell goods

​Jerry's Appliances sells five stoves on account on May 5th. These sales are entered in the sales journal as _____.

• ​a credit to accounts receivable

• ​a debit to accounts receivable

• ​a debit to inventory

• ​a debit to accounts payable

​Shoes R Us ordered 20 pairs of designer sandals for the spring sale on account. This transaction is recorded in the purchases journal as _____.

• ​a credit to inventory and a debit to goods

• ​a credit to accounts receivable and a credit to sales

• ​a credit to accounts payable and a debit to purchases

• ​a debit to accounts receivable

​A small amount of goods at Jerry's Appliances are not sold on account. Where are these sales posted?

• ​cash disbursements journal

• ​sales journal

• ​purchases journal

• ​cash receipts journal

What are the most common source documents for cash disbursement journal entries?

• pre-numbered checks

• balance sheets

• sales receipts

• special ledgers

Which of the following is true of the perpetual inventory method but not the periodic method?

• The Inventory account requires a calculation of the cost of goods sold.

• The Inventory account's balance changes constantly due to debits and credits.

• The cost of purchases are recorded in the Purchases account.

• The Inventory account is adjusted at the end of the accounting period.

Which of the following is true of both the periodic inventory and the perpetual method?

• The Inventory account is credited for the cost of the items sold.

• The Inventory account is adjusted at the end of the accounting period.

• A physical inventory count should be done on occasion.

• The Inventory account is debited when a purchase of goods is made.

A company using a perpetual inventory system sells an item for $560. This transaction should include a credit to _____ and a debit to _____.

• inventory; sales

• sales; inventory

• inventory; accounts receivable

• sales; accounts receivable

A customer returns an item to the store where they purchased it. If this store uses a perpetual inventory system, this transaction should include a credit to _____ and a debit to ______.

• cost of goods sold; inventory

• sales; inventory

• cost of goods sold; accounts receivable

• inventory; accounts receivable

If a company using a perpetual inventory system returns an item to a supplier, the journal entry should include which two accounts?

• accounts receivable and inventory

• accounts payable and inventory

• cost of goods sold and inventory

• cost of goods sold and accounts payable