Question : 58.The journal entry to record the purchase of merchandise account : 1169417

 

 

58.The journal entry to record the purchase of merchandise on account for $2,750 with freight of $125 prepaid by their supplier and added to the invoice is:   

A. debit Purchases $2,750; credit Accounts Payable $2,750

 

B. debit Accounts Payable $2,875, debit Freight in $125; credit Purchases $2,750

 

C. debit Purchases $2,750, debit Freight In $125; credit Accounts Payable $2,875

 

D. debit Accounts Receivable $2,875; credit Sales $2,875

 

 

 

59.Tune Tones Instrument Tuning Company owes Mandy Lynn’s Music Studio $4,856 as of November 1. During November Tune Tones purchased merchandise from Mandy Lynn totaling $8,495 and made payments on account to Mandy Lynn in the amount of $7,250. The amount Tune Tones owes Mandy Lynn on November 30 is:   

A. $6,101

 

B. $3,611

 

C. $10,889

 

D. $7,250

 

 

 

60.A creditor’s account in the accounts payable ledger has a balance of $10,560 as of April 1. After a transaction of $12,800 is posted from the purchases journal and a transaction of $9,200 is posted from the cash payments journal, the balance of the creditor’s account on April 30 is:   

A. $9,200 debit

 

B. $6,960 credit

 

C. $14,160 credit

 

D. $12,800 debit

 

 

 

61.If a business pays $1,100 on account to a creditor, the effect of the payment is a decrease to cash and a(n)   

A. decrease to Fees Income.

 

B. increase of capital.

 

C. increase to accounts receivable.

 

D. decrease to accounts payable.

 

 

 

 

62.Which of the following accounts has a normal debit balance?   

A. Purchases

 

B. Purchase Returns

 

C. Accounts Payable

 

D. Sales

 

 

 

 

63.During March a firm purchased $22,650 of merchandise and paid freight charges of $1,720. If the net delivered cost of purchases for the March is $21,900, what is the total purchase returns for March?   

A. $0

 

B. $2,470

 

C. $970

 

D. $3,440

 

 

 

64.For good internal control of purchases, businesses should do all of the following except:   

A. Computations on the invoice should be checked for accuracy.

 

B. Another person should write the check for payment of the invoice.

 

C. Goods should be carefully checked when received.

 

D. Ensure that the same person is involved in the process of buying, receiving and paying for the goods.

 

 

 

 

65.Skiing International uses a perpetual inventory system when recording its purchases and sales of inventory. If the business purchases $8,000 of goods on account, select the correct entry to record the purchase:   

A. 

 

 

B. 

 

 

C. 

 

 

D. 

 

 

 

 

 

66.Bally Boutique uses a perpetual inventory system when recording its purchases and sales of inventory. The business sells $6,000 of goods to charge account customers and the goods originally cost Bally, $3000. The entry to record the sale would include:   

A. a debit to Cost of Goods Sold for $3,000 and a credit to Merchandise Inventory for $3,000

 

B. a debit to Merchandise Inventory for $3,000 and a credit to Cost of Goods Sold for $3,000

 

C. a debit to Sales for $6,000 and a credit to Merchandise Inventory for $6,000

 

D. a debit to Accounts Receivable for $3,000 and a credit to Sales for $3,000

 

 

 

 

67.If a perpetual inventory system is used instead of a periodic system, identify the accounts that the Merchandise Inventory account replaces.   

A. Purchases, Sales, Freight In

 

B. Purchases, Purchase Returns and Allowances, Freight In

 

C. Purchases, Cost of Goods Sold

 

D. Purchases, Accounts Receivable, Freight In

 

 

 

68.If the perpetual inventory system is used to record the purchase and sale of goods, the account used to record shipping charges is the   

A. purchases account.

 

B. merchandise inventory account.

 

C. transportation in account.

 

D. freight in account.