16. Which term indicates that the buyer will be responsible for transportation costs for goods purchased? A. Freight In. B. Freight Out C. FOB Destination. D. FOB Shipping Point. 17. Purchased goods in transit, shipped FOB Destination, should be excluded from the inventory of the buyer until they are received. A. True. B. False. 18. Discounts taken by a buyer because of early payment are recorded on the seller's accounting records as A. Purchases discount. B. Trade discount. C. Sales discount. D. Inventory discount. 19, Sales made to customers using credit cards such as MasterCard or VSA are recorded as cash sales. A. True. B. False. 20. The periodic inventory system is more widely used than the perpetual inventory system. A. True. B. False. 21. The adjusting entry to record inventory shrinkage would include a debit to Merchandise Inventory and credit to Cost of Merchandise Sold. A. True. B. False. 22. Which of the following can be used to safeguard inventory? A. Purchase order, receiving report, vendor's invoice. B. Using two-way mirrors, cameras, security tags, guards. C. Storing inventory in areas that are restricted to only authorized employees. D. All of the above. 23. In an inflationary environment, which inventory cost flow assumption would produce the highest net income? A. Specific identification. B. Weighted average. C. FIFO. D. LIFO