Accounting Review Chapter 15 - 20

Increasing sales revenue while keeping cost of merchandise sold the same will increase gross profit on sales.

• True

• False

Dividends increase the earnings retained by a corporation.

• True

• False

Temporary accounts are closed at the end of a fiscal period to prepare the general ledger for the next period.

• True

• False

A perpetual inventory is sometimes known as a physical inventory.

• True

• False

Allowing customers to buy now and pay later is an ineffective method for increasing sales.

• True

• False

The adjustment for uncollectible accounts is planned on the work sheet and then recorded in the general journal.

• True

• False

Accounts Receivable is debited to write off a customer account.

• True

• False

First-in, first-out is a method used to determine the quantity of each type of merchandise on hand.

• True

• False

A periodic inventory should be taken at least once a month, even when perpetual inventory records are kept.

• True

• False

When the timing of cash receipts and required cash payments do not match, businesses usually deposit extra cash or borrow cash or make arrangements to delay payments.

• True

• False