chapter5b - Chapter 5b 1 Sales revenue less cost of goods...

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Chapter 5b 1. Sales revenue less cost of goods sold is called net profit. A. True B. False 2. In a perpetual inventory system, a company determines the cost of goods sold each time a sale occurs. A. True B. False 3. In a periodic inventory system, companies keep detailed inventory records of the goods on hand throughout the period. A. True B. False 4. FOB destination means that the seller places the goods free on board the common carrier and the buyer pays the freight costs. A. True B. False 5. Sales Returns and Allowances is a contra revenue account to Sales and has a normal debit balance. A. True B. False 6. A merchandiser using a perpetual system will require one additional adjusting entry to make the records agree with the actual inventory on hand. A. True B. False 7. The income statement for retailers contains one expense category just like the income statement of a service company. A. True B. False 8. A multiple-step income statement distinguishes between operating and non-operating activities. A.
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chapter5b - Chapter 5b 1 Sales revenue less cost of goods...

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