Question 8

Using a perpetual inventory system, Ace Co. sells some inventory FOB destination. Which account would Ace Co. record the freight charges?

Freight would not be charged to ACE Co account not required

Freight out

Merchandise Inventory

Cost of Goods Sold

Question 9

If a company lists Merchandise Inventory as $201,000 on its trial balance, but the physical count determines the actual value of inventory on hand is $199,000, the adjusting entry will include:

a credit to Merchandise Inventory for $191,000

a credit to Merchandise Inventory for $2,000

a debit to Merchandise Inventory for $189,000

a debit to Merchandise Inventory for $2,000

Question 10

Which of the following accounts is not closed to Income Summary?

Cost of Goods Sold

Sales Discounts

Sales

Merchandise Inventory