Exam2B - Exam 3B Practice Questions These questions are...

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Unformatted text preview: Exam 3B Practice Questions These questions are provided to: 1. Give you a chance to test your knowledge, so that you can focus your efforts on your weakest areas. Give you additionai practice. Let you see some possibie ways in which I can setup muitipie choice type probiems. Give you an idea as to the type and towel of material that I generally choose for testing. owe This is NOT a study guide. Your test wiii iikeiy be different both in specifics and construction. You need to ontierstand the rules, not memorize the results. For most questions, your best strategy is to do the problem like it was a nowmuitipie choice homework problem. Do not "shop" the choices, you'll find a reason to choose each one and end up confused. A. x \ . ’3 {VT r” a" A x“\} amw gum.“ {W}; ..... .. . (sf) ‘" Page I ofS Part E. Sweiio, inc. soils down pillows. The foilowing scheduie summarizes the activity in Swerlio’s inventory account during the month oi‘iammry: Beginning inventory E00 units @ $8.00 each Purchase 118 500 units {a} $20.00 each Purchase U10 E00 units @ $24.09 each i’urchase [[14 280 units @ $26.00 each Saies {aii after MS} 650 units as following: [00 from Beginning inventory 300 from 1/8 purchase 80 from lfIO purchase i 179 from if M purchase Show your work and circle yourfinn! answer. 1. How many units are in ending inventory at the end oi‘ianunry? 2. CaEcuiate the cost Mending inventory for Swelio, Inc. under Specific Identification: 3. Using the Weighted Average method: - What is the weighted average cost of E piiiow? m round per unit costs to the nearest penny I Caicuime the cost of ending inventory under the Weighted average method 4. Caicuiaie cost of goods sold for Sweilo under FiFO: U. lithe niilows sold for $50 each, caicuiale gross margin, assuming use of FiFO. Page 2 of5 WWW Pan 2 Eidumunds had the foilowing account balances at Ill/2003.012 first day the accounting period: Accounts rcccivabic: $86,000 Allowance for cholicctibic Accounts: $17,000 During 2003, Edmnmfs had $300,000 in credit safes. Cash coiiccicd from cusiomcrs totaled $280,000. Uncolieczibte accounts of$19,000 were wriucn off. Show your work and circle your final answer. E. What is the no! roai-izablc value of Accounts Receivable on January I, 2003? 2. What is the baiancc in these accounts aficr the 2003 activity described above? Accounts Receivable: Ailowance for UncoElcctiblc Accounts: (debit or credit? Circle one) 3.3 Onlfiécemberfij, 2003. Edgiffniis aged its no 50315 receivab e‘and i caiéuizitcd thfit $12,060 ofgécoutits receiv M}; wofiQ liko \\ i, w conéczab ( Hui-ii much ad debi‘aggmsg wm Edmfim s ificogni‘igj 20mm X- Page 3 OH Part 3 l. The 2002 records of'l'om Company showed beginning inventory, $6,000; cost ofgoods sold, $4,900; and ending inventory, $8,000. The purchases amount for 2002, was A. $12,900 B. 310,000 C. 39,000 D. $16,000 E. None of the above is correct. 2. The cost ofgoods sold account is . an: A. liability B. contra asset C. extraordinary item D. asset E. None of the above is correct 3. Welsh Company purchased an item for inventory that cost SH) per unit and was marked to sell at $14. 11 was determined at the end ofthe accounting period that the item could be replaced for $9 per unit. No purchasss in the near future are anticipated. The per unit valuation for inventory on the balance sheet should be A. $ H109 B. 3 £2.00 C. $9.00 I). 5 £4.00 E. None ofthe above is correct 4. When price are rising: A. FIFO will result in higher net income and a higher inventory valuation than will LIFO. B. FIFO will result in lower net lncome and a lower inventory valuation than will LiFO. C. UFO will result in lower net income and a higher inventory valuation than will FlFO. D. LlFO will result in higher net income and lower inventory valuation than will FEFO. E. None ofthe above is correct. Page 4 of5 5. A. B. C. D. E. Janis, Co. buys £00 folding chairs for $20 each from Harris inc. on February i2, terms 31’10, n30. Which of the foliowing is true, assuming Janis uses the gross method for purchase discounts? Ennis Co. will record the purchase as in increase to inventory and accounts payable for $2,000. Harris has 30 days to receive a 3% discount Janis has 30 days to receive a 3% discount. lfienis pays on February 21,33nis will record it purchase discount of$60.. li'ianis pays on March 13, Janis wiEl record a discount lost or discount expense of $60. For question 6-12, iabel each of the transactions according to its impact on net income and equity, Assume that the transactions occur in October, 2003, 'tlld the company prepares montitiy financiai statements ii). ll. a Decrease D. Nacffcct E. No effect Decrease Adjust the Allowance for Uncoliectible Accounts from $360 to $3300 at the end ofthe current accounting cycle. Sell merchandise to A. Baker to customer) on credit on i-OI2I2GG3. Terms are if} 5, m’30. A. Baker paid account on E0ll522003. Wrile off the account of H. Byalot (a customer) based on news that she has declareé bankruptcy. increased the Warranty Obligation account in at year-end adjusting entry.- Gave customers new items from inventory to repizlce fortity items within the warranty period. Page 5 of5 ...
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Exam2B - Exam 3B Practice Questions These questions are...

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