Ch 19 Quiz Review

The ownership of a corporation is represented by shares of stock.

• True

• False

The statement of retained earnings is prepared before the balance sheet.

• True

• False

The final balances of all permanent accounts as of a specific date are reported on the balance sheet.

• True

• False

The Retained Earnings account always increases at the end of the fiscal period.

• True

• False

Sales Discounts is a contra account of Sales.

• True

• False

The net income reported on the income statement must equal the net income amount calculated on the work sheet.

• True

• False

Capital Stock is the only general ledger account classified as stockholders' equity.

• True

• False

The amount of profit earned before expenses are subtracted is the gross profit on sales.

• True

• False

The balance in the Transportation In account increases the cost of the merchandise purchased during the period.

• True

• False

The cost of merchandise sold is determined by subtracting the ending inventory from the cost of merchandise available for sale.

• True

• False