The accounting for defined benefit plans is usually very easy and straight forwa

Question

The accounting for defined benefit plans is usually very easy and straight forward. 50. The statement of owner's equity shos a. only net income, beginning and ending capitla b. bnly total assets, beginning and ending capital c. only net income, beginning capital, and withdrawasl d. all the changes in the owner's capital as a result of net income, net loss, additional investments, and withdrawals 51. Dorman Co, sold merchandise to Smith Co. on account, $18,000, terms 2/15, net 45. The cost of the merchandise sold is $15,500. Dorman Co, issued a credit memo for $1,750 for merchandise returned that originally cost $1,400. The Smith Co, paid the invoice within the discount period. What is amount of net sales from the above transactions? a. $16,250 b. $14,100 c. $15,925 d. $13,818 52. Which of the following accounts will only be found in the chart of accounts of a merchandising company? a. Sales b. Accounts Receivable c. Merchandise Inventory d. Accounts Payable 53. If title to merchandise purchases passes to the buyer when the goods are shipped from the seller, the terms are a. n/30 b. FOB shipping point c. FOB destination d. consigned 54. The proper journal entry to record the receipt of inventory purchased on account in a perpetual inventory system would be: a. Jan 1 Inventory 540.00 Accounts Payble 540.00 b. jan 1 Office Supplies 540.00 Accounts Payble 540.00 Jan 1 Purchases 540.00 Accounts Payable 540.00 d. Jan 1 Purchases 540.00 Accounts Receivable 540.00

Explanation / Answer

(50) The statement of owner’s equity is one of the shorter financial statementsbecause there aren’t many transactions that actually affect the equity accounts. It typically lists the net income or loss for the period along with the owners’ contributions orwithdrawals during the period. so answer is (D)

(51) answer is (C) 15925 as 18000-1750=16250-2%discount=15925

(52) answer is (a) Sales

Number

Account Title

Income Statement
Section

4000

Sales of Goods

Revenue

4010

Sales Discounts

Revenue

4020

Sales Returns and Allowances

Revenue

5000

Purchases

Cost of goods sold

5010

Purchase Discounts

Cost of goods sold

5020

Purchase Returns and Allowances

Cost of goods sold

5030

Freight

Cost of goods sold

6000

Salaries and Wages

Expense

6005

Payroll Taxes

Expense

6010

Advertising

Expense

6015

Depreciation

Expense

6020

Amortization

Expense

6025

Bank Services

Expense

6030

Rent

Expense

6035

Utilities

Expense

6040

Insurance

Expense

6045

Legal and Accounting

Expense

6050

Postage

Expense

6055

Office Expense

Expense

6060

Supplies

Expense

7010

Interest Income

Non-operating income

7020

Interest Expense

Non-operating expense

8010

Gain on Sale of Fixed Assets

Non-operating income

8020

Miscellaneous Expense

Non-operating expense

9000

Extraordinary items

Non-operating income/expense

(53) answer is (B) F.O.B Shipping Point

(54) answer is (C) Inventory

To Account payable

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