CHAPTERS 5 and 6 - PART I - TRUE/FALSE Answer the following five questions as to what you believe to be either TRUE OR FALSE by placing an X to the right of T for TRUE or F for FALSE. TF1. The two merchandise inventory systems are the Perpetual and the Slow Motion. TF 2. Sales - Cost of Goods Sold Greatest Profits TF 3. Under the Perpetual System, at the time of a sale of merchandise, a business must: record the sale, the accounts receivable or cash received, the cost of the merchandise sold and corresponding reduction from inventory. TF 4. The FIFO method of inventory valuation are initials that stand for: First - In - Forever - Out. F 5. A business buys merchandise with the terms 7/10 net 30. That would mean that the business would receive a 10% discount on the purchase price paid provided that the business makes the payment to the seller within 7 days but otherwise, must pay the full amount within 30 days. PART II - MULTIPLE CHOICE 6. The methods of inventory valuation we learned include the following except for: A. LIFO - Last In First Out Specific Identification Weighted Average D. Standard Deviation or SD 7. Under the Perpetual Inventory System, inventory when sold is credited or reduced from the asset account and moved into which of the following expense accounts: A. Inventory Expense B C. B. Purchases C. Cost of Goods Sold D. Merchandise Expense