Fill This Form To Receive Instant Help

Help in Homework
trustpilot ratings
google ratings


Homework answers / question archive / University of Wisconsin - ACCT I S 300 Quiz 4 1)Successful use of a just-in-time inventory system can narrow the gap between the acid-test and the current ratio

University of Wisconsin - ACCT I S 300 Quiz 4 1)Successful use of a just-in-time inventory system can narrow the gap between the acid-test and the current ratio

Accounting

University of Wisconsin - ACCT I S 300

Quiz 4

1)Successful use of a just-in-time inventory system can narrow the gap between the acid-test and the current ratio.

True

False

  1. The acid-test ratio is defined as current assets divided by current liabilities. True

False

  1. A wholesaler is an intermediary that buys products from manufacturers or other wholesalers and sells them to consumers.

True

False

  1. Sales Discounts and Sales Returns and Allowances are contra revenue accounts that are debited to close the accounts during the closing process.

True

False

  1. Purchase allowances refer to merchandise a buyer acquires but then returns to the seller. True

False

  1. The amount recorded for merchandise inventory includes all of the following except: Freight costs paid by the buyer.
  2. Liquidity problems are likely to exist when a company's acid-test ratio: Is higher than 1.
  3. The gross margin ratio:
  4.  

Merchandise inventory

5,800

 

Cash

 

 

Purchases

5,800

 

Accounts Payable

 

 

 

On May 1, Anders Company, Inc. purchased merchandise in the amount of $5,800 from Shilling, with credit terms of 2/10, n/30. Anders uses the perpetual inventory system. The journal entry or entries that Anders will make on May 1 is:

 

 

 

 

 

 

 

 

 

  1. February 3, Smart Company sold merchandise in the amount of $2,700 to Truman Company, with credit terms of 1/10, n/30. The cost of the items sold is $1,865. Smart uses the perpetual inventory system. Truman pays the invoice on February 8, and takes the appropriate discount. The journal entry that Smart makes on February 8 is:

 

 

  1. Using the following year-end information for Calvin’s Clothing, Inc., calculate the current ratio and acid-test ratio for the business:

 

Cash

$ 52,390

Short-term investments

9,000

Accounts receivable

48,000

Inventory

170,000

Prepaid expenses

7,420

Accounts payable

103,000

 

Other current payables

30,400

2.62 and 1.22

1.15 and 0.82

1.15 and 1

2.15 and 0.82

 

 

  1. A company's gross profit was $123,960 and its net sales were $484,600. Its gross margin ratio equals:

 

25.6%.

3.9%.

74.4%.

$123,960.

$484,600.

 

  1.  

KLM Corporation's quick assets are $6,064,000, its current assets are $13,050,000 and its current liabilities are $8,110 ratio equals:

0.46.

2.36.

1.34.

0.75.

0.62.

 

  1. A company records the following journal entry: debit Cash $1,470, debit Sales Discounts

$30, and credit Accounts Receivable $1,500. This means that a customer has taken what percentage cash discount for early payment?

10%

5%

1%

2%    

15%

  1. Garza Company had sales of $152,200, sales discounts of $2,300, and sales returns of $3,655. Garza Company's net sales equals:

$149,900.

$146,245.

$152,200.

$158,155.

$5,955.

 

 

Option 1

Low Cost Option
Download this past answer in few clicks

3.83 USD

PURCHASE SOLUTION

Already member?


Option 2

Custom new solution created by our subject matter experts

GET A QUOTE

Related Questions