Question : 71.In a periodic inventory system, the cost of goods sold : 1237636

 

 

71.In a periodic inventory system, the cost of goods sold is:   

A.Recorded as sales transactions occur.

 

B.Determined by a computation which is performed at year-end, after the taking of a complete physical inventory.

 

C.Equal to the beginning inventory, plus purchases made during the period, less sales revenue for the period.

 

D.Determined by subtracting the balance in the Gross Profit account from the amount of net sales.

 

 

 

 

72.Which of the following statements about a periodic inventory system is not correct?   

A.These systems are used primarily by small businesses with manual accounting systems.

 

B.The system does not include an up-to-date inventory ledger.

 

C.The balance in the Inventory account remains unchanged until the end of the period.

 

D.The Cost of Goods Sold account is updated as sales transactions occur.

 

 

 

 

73.The following information is available:  Calculate the gross profit:   

A.$0.

 

B.$1,500.

 

C.$450.

 

D.$900.

$2,850 – $2,400 = $450

 

 

 

74.During the year 2015, the inventory of Debra’s Gift Shop decreased by $50,000. If the income statement for the year 2015 reported cost of goods sold of $350,000, purchases during the year must have amounted to:   

A.$400,000.

 

B.$310,000.

 

C.$300,000.

 

D.$350,000.

Beginning inventory + Purchases – Ending inventory = Cost of Goods SoldPurchases = Cost of goods sold – (Beginning inventory – Ending inventory)Purchases = $350,000 – 50,000 = $300,000

 

 

 

Michael uses its periodic inventory system and the following information is available: 

 

75.Refer to the information above. What is the cost of goods sold?   

A.$9,800.

 

B.$33,600.

 

C.$32,200.

 

D.$43,400.

Beginning Inventory ($11,200) + Purchases ($32,200) = Goods Available ($43,400) – Ending Inventory ($9,800) = Cost of Goods Sold ($33,600)

 

 

 

76.Refer to the information above. What is the gross profit?   

A.$9,800

 

B.$33,600

 

C.$32,200

 

D.$43,400

Sales ($43,400) – Cost of Goods Sold ($33,600) = $9,800

 

 

 

Bremmer uses a periodic inventory system and the following information is available: 

 

77.Refer to the information above. What is the cost of goods sold?   

A.$96,800.

 

B.$133,600.

 

C.$132,200.

 

D.$230,400.

Beginning Inventory ($21,200) + Purchases ($132,200) = Goods Available ($153,400) – Ending Inventory ($19,800) = Cost of Goods Sold ($133,600)

 

 

 

78.Refer to the information above. What is the gross profit?   

A.$96,800.

 

B.$133,600.

 

C.$132,200.

 

D.$230,400.

Sales ($230,400) – Cost of Goods Sold ($133,600) = $96,800

 

 

 

79.Merchandising companies that are small and do not use a perpetual inventory system may elect to use:   

A.A physical inventory system.

 

B.A periodic inventory system.

 

C.An inventory shrinkage method.

 

D.An inventory subsidiary ledger system.

 

 

 

 

80.Which of the following would not tend to make a manufacturer choose a perpetual inventory system?   

A.Management wants information about quantities of specific products.

 

B.A low volume of sales transactions and a computerized accounting system.

 

C.A high volume of sales transactions and a manual accounting system.

 

D.Items in inventory with high per unit costs.