161. Cleary Company had total Sales of $550,000; Sales Discounts of $10,000; Sales Returns of $40,000 and Cost of Merchandise Sold of $200,000 during 2010. The total asset balance at the beginning of the year was $175,000 and at the end of the year was $167,000. Calculate the ratio of net sales to total assets (Round answer to 2 decimal points).
A. 1.75
B. 2.92
C. .34
D. .57
162. What is the major difference between a periodic and perpetual inventory system?
A. Under the periodic inventory system, the purchase of inventory will be debited to the Purchases account
B. Under the periodic inventory system, no journal entry is recorded at the time of the sale of inventory for the cost of the inventory.
C. Under the periodic inventory system, all adjustments such as purchases returns and allowances and discounts are reconciled at the end of the month.
D. All are correct.
163. Which of the following accounts will not be found on the Cost of Merchandise Sold section on the Income Statement?
A. Purchases
B. Freight In
C. Sales Returns and Allowances
D. Merchandise Inventory
164. Under the periodic inventory system, the journal entry to record the purchase of merchandise inventory will include a debit to
A. Merchandise Inventory
B. Purchases
C. Accounts Payable
D. Cost of Merchandise Purchased
165. Under the periodic inventory system, the journal entry to record the cost of merchandise sold at the point of sale will include the following account
A. Purchases
B. Cost of merchandise sold
C. Inventory
D. None of the above
166. Under a periodic inventory system, closing entries will include
A. Dr. Sales, Purchases Returns and Allowances, Purchases Discounts
B. Cr. Purchases, Sales Discounts, Sales Returns and Allowances
C. Adjusting the Merchandise Inventory account to match physical inventory
D. All of the above
167. The proper journal entry to record the receipt of inventory purchased on account in a periodic inventory system would be:
A. Jan 1 Inventory 450.00
Accounts Payable 450.00
B. Jan 1 Office Supplies 450.00
Accounts Payable 450.00
C. Jan 1 Purchases 450.00
Accounts Payable 450.00
D. Jan 1 Purchases 450.00
Accounts Receivable 450.00
168. Which of the following accounts should be closed to Income Summary at the end of the fiscal year?
A. Merchandise Inventory
B. Accumulated Depreciation
C. Dividends
D. Cost of Merchandise Sold