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  41) The term used when the purchaser is responsible for the cost of freight is: A) F.O.B. shipping point. B) F.O.B. destination. C) Freight-In. D) Purchases. 42) The term used when the seller is responsible for the cost of freight is: A) F.O.B. shipping point. B) F.O.B. destination. C) Freight-In. D) Purchases. 43) Hardware Restoration had net purchases of $55,000. If Purchases Returns and Allowances are $10,000 and Purchases Discounts are $1,500, what are gross purchases? A) $38,500 B) $55,000 C) $66,500 D) $40,000 44) J&L Lumber reports Purchases of $66,000. If Purchases Returns and Allowances are $6,000 and […]

    38.In a firm that uses special journals, the purchase of merchandise with terms of 2/10, n/30 is recorded in the    A. cash payments journal.   B. cash receipts journal.   C. purchases journal.   D. general journal.         39.In a firm that uses special journals, the return of damaged merchandise to a supplier and receipt of a credit memorandum is recorded in the    A. cash payments journal.   B. cash receipts journal.   C. purchases journal.   D. general journal.         40.In a firm that uses special journals, the purchase of merchandise for $2,800, payable in 30 days, plus a […]

  Fill in the Blank Questions  12.A(n) ____________________ business sells goods that it purchases in finished form for resale.          13.The entry to record a sale of merchandise on credit that is subject to sales tax includes a(n) ____________________ to Sales Tax Payable.          14.A business that sells goods and services directly to individual consumers is called a(n) ____________________ business.          15.The stock of goods kept on hand to sell to consumers is called ________________________.          16.A(n) ____________________ journal is a journal that is used to record only one type of transaction.    […]

    37.Which of the following accounts will not normally have a zero balance after the closing entries have been posted?    A. Income Summary   B. Fees Income   C. The owner's capital account   D. Rent Expense         38.One purpose of closing entries is to    A. transfer the results of operations to owner's equity.   B. reduce the owner's capital account balance to zero so that the account is ready for the next period.   C. adjust the ledger account balances to provide complete and accurate figures for use on financial statements.   D. close all accounts so that the ledger is ready for […]

  31) Allan Corporation issued 300, 8%, 10-year, $1,000 bonds on July 1. The annual bond interest date is June 30, and the bonds were issued at face value. The amount of interest expense reported for the current year is: A) $0. B) $24,000. C) $12,000. D) None of the above are correct.   32) On October 1, Allan Company issued 8%, 10-year, $300,000 bonds at 100. Interest dates are April 1 and October 1. The amount of cash paid out for interest during the current calendar year is: A) $0. B) $24,000. C) $12,000. D) $6,000. 33) On April […]