Question : 151. Under the perpetual inventory system, all purchases of merchandise debited : 1251865

151. Under the perpetual inventory system, all purchases of merchandise are debited to the account entitled  
A. Merchandise Inventory
B. Cost of Merchandise Sold
C. Cost of Merchandise Available for Sale
D. Purchases

152. When the perpetual inventory system is used, the inventory sold is debited to  
A. supplies expense
B. cost of merchandise sold
C. merchandise inventory
D. sales

153. Under a perpetual inventory system  
A. accounting records continuously disclose the amount of inventory
B. increases in inventory resulting from purchases are debited to Purchases
C. there is no need for a year-end physical count
D. the purchase returns and allowances account is credited when goods are returned to vendors

154. The proper journal entry to record the receipt of inventory purchased on account in a perpetual inventory system would be: 
A. Jan 1  Inventory              540.00
               Accounts Payable        540.00
B. Jan 1  Office Supplies     540.00
               Accounts Payable        540.00
C. Jan 1  Purchases               540.00
               Accounts Payable        540.00
D. Jan 1  Purchases               540.00
               Accounts Receivable    540.00

155. Which of the following items should not be included in the cost of ending merchandise inventory? 
A. purchased units in transit, shipped FOB shipping point
B. purchased units in transit, shipped FOB destination
C. units on hand in the warehouse
D. sold units in transit, not invoiced and shipped FOB destination

156. The Corbit Corp. sold merchandise for cash, $7,200.  The cost of the merchandise sold was $3,950.  The journal entry(s) to record this transaction would be 
A. Cash                                             7,200
      Merchandise Inventory                        7,200

Cost of Merchandise Sold               3,950
       Sales                                                  3,950
B. Cash                                             7,200
      Sales                                                  7,200

Cost of Merchandise Sold              3,950
     Merchandise Inventory                         3,950 
C. Cash                                             7,200
      Sales                                                   7,200

Cost of Merchandise Sold              7,200
     Merchandise Inventory                         7,200 
D. Cash                                             3,950
      Sales                                                  3,950

Cost of Merchandise Sold               3,950
     Merchandise Inventory                         3,950 

157. Inventory shortage is recorded when 
A. merchandise is returned by a buyer.
B. merchandise purchased from a seller is incomplete or short.
C. merchandise is returned to a seller.
D. there is a difference between a physical count of inventory and inventory records.

158. If the physical count of the inventory revealed $72,000 of merchandise on hand and the inventory records reported $73,200, what would be the necessary adjusting entry to record inventory shortage? 
A. Merchandise inventory debit $72,000; Cost of Merchandise Sold credit $72,000.
B. Merchandise inventory debit $1,200; Cost of Merchandise Sold credit $1,200.
C. Cost of Merchandise Sold debit $73,200; Merchandise Inventory credit $72,000.
D. Cost of Merchandise Sold debit $1,200; Merchandise Inventory credit $1,200.

159. Which account will be included in both service and merchandising companies closing entries? 
A. Sales
B. Cost of Merchandise Sold
C. Purchase Discounts
D. Sales Returns and Allowances

160. Ramone Company had $600,000 in Net Sales for the year 2011.  The total assets at the beginning of the year were $240,000 and total assets at the end of the year were $280,000.  The ratio of net sales to total assets is (round answer to 2 decimal places):  
A. 2.31
B. 1.15
C. .43
D. .87