ACC 557 Week 5, Quiz - Graded 100% Latest Version.docx

ACC 557 Week 5, Quiz - Graded 100% Latest V 1. Cost of goods sold is determined only at the end of the accounting period in A). neither a perpetual nor a periodic inventory system. B). a perpetual inventory system. C). a periodic inventory system. D). both a perpetual and a periodic inventory system 2. A sales invoice is a source document that A). provides evidence of incurred operating expenses. B). provides evidence of credit sales. C). serves only as a customer receipt. D). provides support for goods purchased for resale. 3. Financial information is presented below: Operating Expenses $ 45,000 Sales Returns and Allowances 9,000 Sales Discounts 6,000 Sales Revenue 160,000 Cost of Goods Sold 87,000 The gross profit rate would be A).503. B).363. C).400. D).456. 4. The Sales Returns and Allowances account is classified as a(n) A). contra revenue account. B). contra asset account. C). expense account. D). asset account. 5. On October 4, 2013, JT Corporation had credit sales transactions of $3,200 from merchandise having cost $1,900. The entries to record the day's credit transactions include a A). credit of $1,900 to Cost of Goods Sold. B). credit of $3,200 to Sales Revenue. C). debit of $1,900 to Inventory. D). debit of $3,200 to Inventory. 6. Comprehensive income under IFRS A). excludes unrealized gains and losses included in net income, in contrast to GAAP. B). includes unrealized gains and losses included in net income, similar to GAAP. C). excludes unrealized gains and losses included in net income, similar to GAAP. D). includes unrealized gains and losses included in net income, in contrast to GAAP 7. If a company has net sales of $700,000 and cost of goods sold of $490,000, the gross profit percentage is A). 30%. B). 70%. C). 100%. D). 15%. 8. The consistent application of an inventory costing method is essential for A). accuracy. B). efficiency. C). comparability. D). conservatism. 9. The inventory turnover ratio is computed by dividing cost of goods sold by A). beginning inventory. B). ending inventory. C). average inventory. D). 365 days. 10. Switzer, Inc. has 5 computers which have been part of the inventory for over two years. Each computer cost $600 and originally retailed for $900. At the statement date, each computer has a current replacement cost of $400. How much loss should Switzer, Inc., record for the year? A). $2,000. B). $2,500. C). $1,000. D). $1,500. 11. Which one of the following inventory methods is often impractical to use? A). LIFO B). FIFO C). Specific identification D). Average cost 12. Overstating ending inventory will overstate all of the following except A). net income. B). owner's equity. C). assets. D). cost of goods sold. 13. Under IFRS, companies can choose which inventory system? LIFO FIFO Yes No Yes Yes No Yes No No 14. The lower-of-cost-or-market (LCM) basis may be used with all of the following methods except A). FIFO. B). LIFO. C). The LCM basis may be used with all of these. D). average cost. 15. Inventory items on an assembly line in various stages of production are classified as A). Raw materials. B). Merchandise inventory. C). Finished goods. D). Work in process.