MULTIPLE CHOICEch-8 - MULTIPLE CHOICEConceptual 21 When...

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MULTIPLE CHOICE —Conceptual 21. When using a perpetual inventory system, a. no Purchases account is used. b. a Cost of Goods Sold account is used. c. two entries are required to record a sale. d. all of these. 22. Goods in transit which are shipped f.o.b. shipping point should be 23. Goods in transit which are shipped f.o.b. destination should be 24. Which of the following items should be included in a company's inventory at the balance sheet date? Use the following information for questions 25 and 26. During 2007 Foley Corporation transferred inventory to Kline Corporation and agreed to repurchase the merchandise early in 2008. Kline then used the inventory as collateral to borrow from Norwalk Bank, remitting the proceeds to Foley. In 2008 when Foley repurchased the inventory, Kline used the proceeds to repay its bank loan. 25. This transaction is known as a(n) a. consignment. b. installment sale. c. assignment for the benefit of creditors. d. product financing arrangement. 26. On whose books should the cost of the inventory appear at the December 31, 2007 balance sheet date?
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27.Goods on consignment are S 28. Valuation of inventories requires the determination of all of the following except P 29. The accountant for the Orion Sales Company is preparing the income statement for 2007 and the balance sheet at December 31, 2007. Orion uses the periodic inventory system. The January 1, 2007 merchandise inventory balance will appear a. only as an asset on the balance sheet. b. only in the cost of goods sold section of the income statement. c. as a deduction in the cost of goods sold section of the income statement and as a current asset on the balance sheet. d. as an addition in the cost of goods sold section of the income statement and as a current asset on the balance sheet.
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