Accounting 1 Test #3

Financial Statements

100

Sales
- Sales Discounts
- Sales Returns and Allowances

What is Net Sales?

200

Net Sales
- Cost of Goods Sold

What is Gross Profit?

300

Gross Profit
- Operating Expenses

What is Income from Operations?

400

Income from Operations
- Non Operating Loss/Expense
+Non Operating Gains/ Revenue

What is Net Income?

500

List the other 5 numbers for multiple step income statements and how to find them. 

What is current assets, liabilities, total assets, liabilities, and equity.

Periodic Inventory

100

FIFO

What is First in, First out?

200

LIFO

What is Last in, First Out?

300

Calculate Units available for sale

What is beginning inventory + purchases?

400

Calculate ending inventory

What is Cost of units Available for Sale - Cost of Goods Sold?

500

Assume Vanilla purchased 1500 additional units on July 28th. The purchase was FOB shipping and the goods were in transit as of July 31st. Would this additional information change their month end inventory?

What is yes, in an FOB shipping transaction the units belong to the buyer once they are in transit?

Accounts Receivable

100

Calculating Net realizable Value

What is Account receivable - estimated uncollectables?

200

The balance in the Allowance account is a credit. How do you determine the amount for the adjusting entry?

What is Total Estimated Uncollectibles - The Credit Balance

300

The balance in the Allowance account is a debit. How do you determine the amount for the adjusting entry?

What is the Total Estimated Uncollectibles + The Debit Balance

400

The amount of a write off is less than the company's estimated uncollectibles. Does Net realizable Value change?

What is no, the estimation accounts for any losses less than that amount. 

500

The accounts used to update the balance in the Allowance account

What is
Dr Bad Debt Expense
Cr Allowance for Doubtful Accounts

Merchandising Transactions

100

5/20 and n/60 are examples of? (explain)

What is credit terms?

200

What accounts are used to explain the beginning SALE of merchandise? (FOB Destination)

What is
Dr A/R
Cr Sales
Dr Cost of Goods Sold
Cr Inventory
Dr Delivery Expense
Cr Cash

300

What accounts are used to explain the beginning PURCHASE of merchandise? (FOB Shipping)

What is
Dr Inventory
Cr A/P
Dr Inventory
Cr Cash

400

What accounts are used to explain a return? (buyer) 

What is
Dr A/P
Cr Inventory

500

What accounts are used to explain the payment for merchandise with a discount? (seller)

What is
Dr Cash
Dr Sales Discounts
Cr A/R

Perpetual Inventory and LCM

100

When using the Perpetual inventory ledger the first thing you do is rewrite beginning inventory. 

What is yes, always write beginning inventory before calculating the sale/ purchase of merchandise?

200

What 2 spots do you update in the perpetual inventory ledger for a purchase?

What is purchases and inventory?

300

What 2 spots do you update in the perpetual inventory ledger for a sale?

What is Cost of Goods Sold and Inventory?

400

What accounts are used when preparing the LCM adjustment?

What is
Dr Cost of Goods Sold
Cr Inventory

500

Calculate the number for the LCM adjustment

What is the difference between the Cost values that are higher than the market values?