Acc 557 Midterm Exam Part 2

ACC 557 MIDTERM EXAM PART 2




Question 1
Net income is gross profit less
• financing expenses.
• operating expenses.
• other expenses and losses.
• other expenses.

Question 2
On November 2, 2014, Kasdan Company has cash sales of $6,000 from merchandise having a cost of $3,600. The entries to record the day's cash sales will include:
• a $3,600 credit to Cost of Goods Sold.
• a $6,000 credit to Cash.
• a $3,600 credit to Inventory.
• d     a $6,000 debit to Accounts Receivable.

Question 3
Glenn Company purchased merchandise inventory with an invoice price of $9,000 and credit terms of 2/10, n/30. What is the net cost of the goods if Glenn Company pays within the discount period?
• $8,100
• $8,280
• $8,820
• $9,000

Question 4
When a seller grants credit for returned goods, the account that is credited is
• Sales Revenue.
• Sales Returns and Allowances.
• Inventory.
• Accounts Receivable.

Question 5
An aging of a company's accounts receivable indicates that $14,000 are estimated to be uncollectible. If Allowance for Doubtful Accounts has a $1,100 credit balance, the adjustment to record bad debts for the period will require a
• debit to Bad Debt Expense for $14,000.
• debit to Allowance for Doubtful Accounts for $12,900.
• debit to Bad Debt Expense for $12,900.
• credit to Allowance for Doubtful Accounts for $14,000.


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Question 6
The basic issues in accounting for notes receivable include each of the following except
• analyzing notes receivable.
• disposing of notes receivable.
• recognizing notes receivable.
• valuing notes receivable.

Question 7
Three accounting issues associated with accounts receivable are
• depreciating, returns, and valuing.
• depreciating, valuing, and collecting.
• recognizing, valuing, and disposing.
• accrual, bad debts, and disposing.

Question 8
A cash discount is usually granted to all of the following...