Where are selling and administrative expenses found on the multiple-step income statement?
a. before gross profit
b. after sales and before gross profit
c. after net income and before expenses
d. after gross profit
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Q. 2) Assume 2011 is the company's first year of business and there were no dividends declared in 2011.
For the year ended
December 31, 2011
Revenues 300
Expenses 1. _____________
Net Income 2. _____________
December 31, 2011
Assets 1,000
Liabilities 3. _____________
Contributed capital 300
Retained earnings 200
Determine the missing amounts, 1. Expenses. 2. Net income and 3. Liabilities, in the condensed income statement and balance sheet for the year ended December 31, 2011.
A) 1. Expenses of (100); 2. Net income of 200; 3. Liabilities of 500
B) 1. Expenses of (200); 2. Net income of 500; 3. Liabilities of 1,500
C) 1. Expenses of (200); 2. Net income of 100; 3. Liabilities of 500
D) 1. Expenses of (500); 2. Net income of 200; 3. Liabilities of 500
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Q. 3) A programming error causes the sale of an inventory item to be added to the quantity on hand attribute in the inventory master data. Which control goal was not achieved?
a. ensure update completeness
b. ensure input accuracy
c. ensure update accuracy
d. ensure input completeness
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Q. 4) Which of the following DECREASES the cost of inventory purchased?
A) sales tax
B) purchasing merchandise FOB shipping point
C) purchase allowances
D) payment of accounts payable
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Q. 5) To a business, ____________________ includes currency, coins, checks received from customers, money orders, and bank cashier's checks.
Fill in the blank(s) with correct word
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Q. 6) A company, using the periodic inventory system, has merchandise inventory costing 210 on hand at the beginning of the period. During the period, merchandise costing 635 is purchased. At year-end, merchandise inventory costing 160 is on hand. The cost of merchandise sold for the year is
a. 795
b. 685
c. 265
d. 635
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