Question 1 of 20 0.0/ 5.0 points medeco bought goods for $250 on

Question 1 of 20

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Medeco bought goods for $250 on credit. Medeco returned $50 worth of goods. Terms of the sale were 2/10, n/30. If Medeco pays the amount owed within the discount period, what is the amount it should pay?

 

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A. $250

 

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B. $204

 

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C. $196

 

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D. $200

 

Question 2 of 20

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A list of creditors with balances owed is called a

 

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A. schedule of accounts receivable.

 

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B. schedule of accounts payable.

 

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C. list of suppliers.

 

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D. trade list.

 

Question 3 of 20

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The normal balance for Purchases Returns and Allowances is

 

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A. a debit.

 

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B. a credit.

 

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C. zero.

 

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D. It doesn’t have a normal balance.

 

Question 4 of 20

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A. O.B. shipping point means

 

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B. the buyer pays for the freight.

 

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C. the seller pays for the freight.

 

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D. the title passes at time of shipment.

 

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E. Both A and C

 

Question 5 of 20

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When the term F.O.B. shipping point is used, title passes when the

 

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A. goods reach the halfway point.

 

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B. goods reach the destination.

 

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C. goods are shipped.

 

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D. buyer unpacks the goods.

 

Question 6 of 20

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The entry to record a purchase of $5,000 on account, terms of 2/10, n/30, would include a

 

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A. debit to Purchases Discount for $100.

 

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B. credit to Accounts Payable for $5,000.

 

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C. debit to Accounts Payable for $5,000.

 

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D. credit to Cash for $5,000.

 

Question 7 of 20

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The entry to record a payment on a $600 account within the 2% discount period would include a

 

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A. debit to Accounts Payable for $588.

 

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B. debit to Accounts Payable for $600.

 

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C. credit to Purchases for $588.

 

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D. debit to Cash for $600.

 

Question 8 of 20

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Merchandise paid for within the discount period for a Cash refund was returned. This will be recorded with a

 

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A. credit to a liability.

 

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B. credit to an asset.

 

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C. debit to a liability.

 

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D. debit to an asset.

 

Question 9 of 20

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Purchases are a/an

 

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A. cost.

 

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B. asset.

 

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C. liability.

 

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D. revenue.

 

Question 10 of 20

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Clothes R Us bought some new clothes for its fashion line and is required to pay the freight costs. The freight terms are

 

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A. F.O.B. destination.

 

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B. F.O.B. shipping point.

 

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C. 3/10, n/30.

 

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D. None of the above

 

Question 11 of 20

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Tyler returned $500 worth of merchandise within the discount period. The entry to record the return is which of the following?

 

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A. Debit Purchases for $500; credit Accounts Payable $500

 

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B. Debit Purchases for $500; credit Purchases Returns and Allowances $500

 

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C. Debit Accounts Payable/Suppliers Name for $500; credit Purchases Returns and Allowances for $500

 

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D. Debit to Accounts Payable for $500, credit Purchases Discount for $500

 

Question 12 of 20

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On April 30, Miller’s Bike Goods purchased $600 of merchandise on account from the Spark Company. The goods were shipped F.O.B. shipping point. The freight charge of $40 was paid by Spark Company and added to the invoice. The amount to record in the Purchases account is

 

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A. $650.

 

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B. $640.

 

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C. $550.

 

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D. $450.

 

Question 13 of 20

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Jackson purchased $500 of goods and received credit terms of 2/10, n/30. How much did he pay if payment was made during the discount period?

 

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A. $450

 

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B. $510

 

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C. $500

 

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D. $490

 

Question 14 of 20

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When merchandise is bought for resale, which account would be decreased?

 

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A. Store Equipment

 

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B. Purchases

 

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C. Cash

 

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D. Capital

 

Question 15 of 20

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On February 12, Clare purchased $400 of merchandise on account from Larsen’s Accessories, terms 2/10, n/30. The goods were shipped F.O.B. destination. The freight charge was $40. The amount to be recorded in the Accounts Payable Subsidiary ledger is

 

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A. $392.

 

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B. $408.

 

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C. $400.

 

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D. $440.

 

Question 16 of 20

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A debit memorandum increases which account on the buyer’s books?

 

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A. Accounts Payable

 

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B. Purchases Returns and Allowances

 

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C. Sales Returns and Allowances

 

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D. Accounts Receivable

 

Question 17 of 20

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On November 30, Janoch’s Dog Kennel purchased $600 of merchandise on account from the Ganster Company. The goods were shipped F.O.B. shipping point. The freight charge of $40 was paid by Ganster Company and added to the invoice. The amount to record in the Purchases account is

 

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A. $600.

 

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B. $640.

 

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C. $560.

 

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D. $550.

 

Question 18 of 20

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Heidi’s Accessories bought 50 necklaces for $10 each on account. The invoice included a 6% sales tax and payment terms of 2/10, n/30. Five necklaces were returned prior to payment. The entry to record the purchase would include a debit to

 

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A. Accounts Payable for $530.

 

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B. Accounts Payable for $500.

 

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C. Purchases for $530.

 

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D. Purchases for $500.

 

Question 19 of 20

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The Accounts Payable subsidiary ledger

 

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A. lists accounts alphabetically.

 

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B. lists accounts for which the company owes money.

 

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C. has a controlling account in the general ledger.

 

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D. All of the above

 

Question 20 of 20

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If a display rack was purchased for the store, which account would be increased?

 

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A. Store Equipment

 

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B. Purchases

 

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C. Cash

 

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D. Capital

 

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