Question 1 (5 points)

F.O.B. shipping point means __________.

Question 1 options:

	the buyer pays for the freight
	the seller pays for the freight
	the title passes at time of shipment
	both A and C

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Question 2 (5 points)

The entry to record a purchase of $5,000 on account, terms of 2/10, n/30, would include a __________.

Question 2 options:

	debit to Purchases Discount for $100
	credit to Accounts Payable for $5,000
	debit to Accounts Payable for $5,000
	credit to Cash for $5,000

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Question 3 (5 points)

Medeco bought goods for $250 on credit. Medeco returned $50 worth of goods. Terms of the sale were 2/10, n/30. If Medeco pays the amount owed within the discount period, what is the amount they should pay?

Question 3 options:

	$250
	$204
	$196
	$200

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Question 4 (5 points)

Which is the controlling account for the amounts owed to individual creditors?

Question 4 options:

	Accounts Payable in the general ledger
	Accounts Receivable in the general ledger
	Accounts Receivable in the subsidiary ledger
	Accounts Payable in the subsidiary ledger

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Question 5 (5 points)

Heidis Accessories bought 50 necklaces for $10 each on account. The invoice included a 6% sales tax and payment terms of 2/10, n/30. Five necklaces were returned prior to payment. The entry to record the purchase would include a __________.

Question 5 options:

	debit to Accounts Payable for $530
	debit to Accounts Payable for $500
	debit to Purchases for $530
	debit to Purchases for $500

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Question 6 (5 points)

A debit memorandum decreases which account on the sellers books?

Question 6 options:

	Accounts Payable
	Purchases Returns and Allowances
	Sales Returns and Allowances
	Accounts Receivable

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Question 7 (5 points)

On November 30, Janochs Dog Kennel purchased $600 of merchandise on account from the Ganster Company. The goods were shipped F.O.B. shipping point. The freight charge of $40 was paid by Ganster Company and added to the invoice. The amount to record in the Purchases account is __________.

Question 7 options:

	$600
	$640
	$560
	$550

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Question 8 (5 points)

A debit memorandum increases which account on the buyers books?

Question 8 options:

	Accounts Payable
	Purchases Returns and Allowances
	Sales Returns and Allowances
	Accounts Receivable

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Question 9 (5 points)

Jackson purchased $500 of goods and received credit terms of 2/10, n/30. How much did he pay if payment was made during the discount period?

Question 9 options:

	$450
	$510
	$500
	$490

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Question 10 (5 points)

The normal balance for Purchases Returns and Allowances is __________.

Question 10 options:

	a debit
	a credit
	It does not have a normal balance
	zero

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Question 11 (5 points)

Returned merchandise under the periodic inventory method. This will be recorded with a __________.

Question 11 options:

	debit to Accounts Payable and a credit to Purchases Returns and Allowances
	debit to Merchandise Inventory and a credit to Purchases
	credit to Accounts Payable and a debit to Merchandise Inventory
	debit to Accounts Payable and a credit to Merchandise Inventory

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Question 12 (5 points)

The Accounts Payable subsidiary ledger __________.

Question 12 options:

	lists accounts alphabetically
	lists accounts for which the company owes money
	has a controlling account in the general ledger
	all of the above

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Question 13 (5 points)

On February 12, Clare purchased $400 of merchandise on account from Larsens Accessories, terms 2/10, n/30. The goods were shipped F.O.B. destination. The freight charge was $40. The amount to be recorded in the Accounts Payable Subsidiary ledger is __________.

Question 13 options:

	$392
	$408
	$400
	$440

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Question 14 (5 points)

If a display rack was purchased for the store, which of the following accounts would be increased?

Question 14 options:

	Store Equipment
	Purchases
	Cash
	Capital

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Question 15 (5 points)

When merchandise is bought for resale, which of the following accounts would be decreased?

Question 15 options:

	Store Equipment
	Purchases
	Cash
	Capital

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Question 16 (5 points)

On June 15, Paradise Park purchased merchandise for the race track. The invoice was for $4,500, terms 2/10, n/30. On June 20, Paradise Park returned $200 of merchandise for credit. On June 25, it paid the amount owed. The debit to Purchases on June 15 is __________.

Question 16 options:

	$4,214.00
	$4,786.00
	$4,300.00
	$4,500.00

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Question 17 (5 points)

Merchandise paid for within the discount period for a Cash refund was returned. This will be recorded with a __________.

Question 17 options:

	credit to a liability
	credit to an asset
	debit to a liability
	debit to an asset

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Question 18 (5 points)

To prove that the subsidiary ledger agrees with the Accounts Payable controlling account balance, complete a __________.

Question 18 options:

	debit memorandum
	schedule of accounts payable
	purchase order
	schedule of accounts receivable

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Question 19 (5 points)

A list of creditors with balances owed is called a __________.

Question 19 options:

	schedule of accounts receivable
	schedule of accounts payable
	list of suppliers
	trade list

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Question 20 (5 points)

Heidis Accessories bought 50 necklaces for $10 each on account. The invoice included a 6% sales tax and payment terms of 2/10, n/30. Five necklaces were returned prior to payment. The entry to record the payment (within the discount period. would include __________.

Question 20 options:

	a credit to Cash for $477
	a credit to Cash for $468
	a credit to Accounts Receivable for $477
	a credit to Accounts Receivable for $468

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