accounting principle

A company had $950,000 in sales, sales discounts of $12,350, sales returns and allowances of $18,675, cost of goods sold of $394,250, and $285,000 in operating expenses. Net income equals:

• 239 725

• 265 455

• 235 725

• 345 645

A company that uses the net method of recording purchases and a perpetual inventory system purchased $3,600 of merchandise on July 5 with terms 2/10, n/30. On July 7, it returned $800 worth of merchandise. On July 28, it paid the full amount due. The correct journal entry to record the payment on July 28 is:

• Debit Cash $2,800; credit Accounts Payable $2,800.

• Debit Accounts Payable $2,800; credit Merchandise Inventory $56; credit Cash $2,744.

• Debit Accounts Payable $2,744; debit Discounts Lost $56; credit Cash $2,800.

• Debit Merchandise Inventory $2,800; credit Cash $2,800.

If an invoice reads "FOB shipping point", who pays for the transportation cost

• The buyer

• The seller

• Both

• Neither seller nor buyer

Net sale - cost of good sold - operating expense = ?

• Gross profit

• Net profit

• Revenue

• Net income

Using a perpetual inventory system, the entry to record the return from a customer of merchandise sold on account includes a

• Debit to cash

• Credit to Merchandise Inventory

• Debit to merchandise inventory

• Credit to Customer rufunds payable

The cost of good sold is determined and recorded each time a sale occurs in:

• periodic inventory system only

• perpetual inventory system only

• both

• neither a periodic nor perpetual inventory system

Merchandise with a sales price of 3000$ is sold on account with terms 2/10, n/30. The journal entry to record the sale would include a

• Debit to cash for $3000

• Debit to sale discount for $100

• Credit to sales for $2940

• Debit to account receivable for $2850