81. The gross margin ratio:
A. Is also called the net profit ratio.
B. Measures a merchandising firm's ability to earn a profit from the sale of inventory.
C. Is also called the profit margin.
D. Is a measure of liquidity.
E. Should be greater than 1.
82. A company's gross profit was $83,750 and its net sales were $347,800. Its gross margin ratio equals:
A. 4.2%
B. 24.1%
C. 75.9%
D. $83,750
E. $264,050
83. A company's net sales were $676,600, its cost of goods sold was $236,810, and its net income was $33,750. Its gross margin ratio equals:
A. 5%
B. 9.6%
C. 35%
D. 65%
E. 285.7%
84. J.C. Penny had net sales of $28,496 million, cost of goods sold of$19,092 million, and net income of$997 million. Its gross margin ratio equals:
A. 3.5%
B. 5.2%
C. 33%
D. 67%
E. 149.3%
85. A company had net sales of $82,000, cost of goods sold of $70,000, and other expenses of $2,000. Its gross margin ratio equals:
A. 85.37%
B. 2.44%
C. 14.63%
D. 16.67%
E. 683.33%
86. The credit terms 2/10, n/30 are interpreted as:
A. 2% cash discount if the amount is paid within 10 days, with the balance due in 30 days,
B. 10% cash discount if the amount is paid within 2 days, with balance due in 30 days,
C. 30% discount if paid within 2 days,
D. 30% discount if paid within 10 days,
E. 2% discount if paid within 30 days,
87. A trade discount is:
A. A term used by a purchaser to describe a cash discount given to customers for prompt payment,
B. A reduction in price below the list price,
C. A term used by a seller to describe a cash discount granted to customers for prompt payment,
D. A reduction in price for prompt payment,
E. Also called a rebate,
88. A company uses the perpetual inventory system and recorded the following entry:
Accounts Payable
|
2,500
|
|
Merchandise Inventory
|
|
50
|
Cash
|
|
2,450
|
This entry reflects a:
A. Purchase,
B. Return,
C. Sale,
D. Payment of the account payable and recognition of a cash discount taken,
E. Purchase and recognition of a cash discount taken,
89. A debit memorandum is:
A. Required whenever a journal entry is recorded,
B. The source document for the purchase of merchandise inventory,
C. Required when a purchase discount is granted,
D. The document a buyer issues to inform the seller of a debit made to the seller's account in the buyer's records,
E. Not necessary in a perpetual inventory system,
90. A company purchased $1,800 of merchandise on December 5. On December 7, it returned $200 worth of merchandise. On December 8, it paid the balance in full, taking a 2% discount. The amount of the cash paid on December 8 is:
A. $200
B. $1,564
C. $1,568
D. $1,600
E. $1,800