Quiz Advanced Accounting Practical

In installment sales, gross profit is recognized in installments based on...

• The percentage of installment sales paid in cash.

• The full value of the sale at the time of the transaction.

• The percentage of gross profit from sales received.

• The percentage of total assets received.

How is the journal entry recorded when receiving installment payments?

• Debit: Installment Receivables, Credit: Cash

• Debit: Cash, Credit: Installment Receivables.

• Debit: Gross Profit, Credit: Cash

• Debit: Installment Receivables, Credit: Installment Sales

In a decentralized system, branch offices have the authority to...

• Record head office inventory as its assets.

• Prepare financial reports independently.

• Close financial reports to the head office every day

• Sell fixed assets owned by the head office.

When the head office sends goods to the branch office, the account recorded by the branch office is...

• Purchase of Goods

• Head Office Inventory

• Branch Office Inventory

• Goods Sold Expense

Why is transaction reconciliation between the head office and branch offices necessary?

• To ensure the integration of inventory data.

• To calculate the branch's profit and loss independently.

• To reduce data duplication between the head office and branch offices.

• To avoid the consolidation of financial statements.

What happens to the petty cash account when an expense occurs under the imprest method?

• It is recorded as an immediate expense in the petty cash account.

• Petty cash is reduced by the expense incurred.

• No journal entry is made until the petty cash is replenished.

• It is added to the beginning balance of petty cash.

When the consignee successfully sells the consigned goods, the journal recorded by the consignee is...

• Debit: Sales, Credit: Cash.

• No journal recorded by the consignee

• Debit: Accounts Receivable, Credit: Sales

•  Debit: Cash, Credit: Commission Income

The commission received by the consignee for the sale of consigned goods is recorded as...

• Consignment Income

• Consignment Expenses

• Debt to Consignor

• Commission Income

In the physical  method, merchandise inventory is only counted and recorded when...

• Goods arrive at the warehouse

• Every time a sale occurs

• End of accounting period

• Purchase of merchandise

In the perpetual method, every time a sale occurs, the company will record...

• Only the sale of goods

• Addition to inventory

• Reduction to inventory and recognition of COGS

• Purchase back of merchandise