F08_3A_MT2-1

F08_3A_MT2-1 - Version 1 ECON 3A FALL 2008 EXAM #2 Name: _...

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Version 1 Version 1 Page 1 ECON 3A FALL 2008 EXAM #2 Name: __________________________ Perm #: _____________ ANSWER QUESTIONS #1-25 ON GREEN SCANTRON ANSWER THE REST OF THE QUESTIONS IN THE SPACE PROVIDED. REMEMBER TO WRITE YOUR EXAM VERSION # ON YOUR SCANTRON 1. What do you debit when you purchase inventory using the periodic inventory method? A) Purchases B) Accounts payable C) Accounts receivable D) Inventory 2. Which of the following balances on the trial balance would tend to indicate the possible need for an adjusting journal entry at the end of an accounting period? A) Unearned revenues C) Prepaid expenses B) Accrued expenses D) All of these 3. The cost of freight to receive inventory purchased by a company should be reported as: A) An expense as incurred B) A reduction to sales immediately C) An addition to inventory D) A reduction to sales of the inventory when the inventory is sold 4. Which inventory method provides a "control" measure by allowing physical counts to be compared to expected amounts? A) Latent B) Periodic C) Loquacious D) Perpetual 5. Hunter Company purchased merchandise inventory with an invoice price of $6,000 and credit terms of 2/10, n/30. What is the net cost of the goods if Hunter Company pays within the discount period? A) $5,880 B) $5,400 C) $5,520 D) $6,000 6. Failure to prepare an adjusting entry at the end of the period to record an accrued expense would cause A) an understatement of expenses and an understatement of liabilities. B) an overstatement of expenses and an overstatement of liabilities. C) an overstatement of assets and an overstatement of liabilities. D) net income to be understated. 7. Net income will result if gross profit exceeds A) operating expenses. B) cost of goods sold plus operating expenses. C) cost of goods sold. D) purchases.
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Version 1 Version 1 Page 2 8. A merchandiser will earn an operating income of exactly $0 when A) gross profit equals operating expenses. C) cost of goods sold equals gross margin. B) net sales equals cost of goods sold. D) operating expenses equal net sales. 9. Which inventory method utilizes bar codes and computers? A) Latent B) Post-particulant C) Periodic D) Perpetual 10. A credit sale of $800 is made on April 25, terms 2/10, net/30, on which a return of $50 is granted on April 28. What amount is received as payment in full on May 3? A) $784 B) $800 C) $750 D) $735 11. Which inventory provides the best "matching"? A) Latent B) Periodic C) Lavendar D) Perpetual 12. If a purchaser using a perpetual inventory system pays the transportation costs, then the A) Delivery Expense account is increased. B) Freight-out account is increased.
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F08_3A_MT2-1 - Version 1 ECON 3A FALL 2008 EXAM #2 Name: _...

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