Under a perpetual inventory system, when a sale is made, the seller prepares:
A.no journal entry.
B.one journal entry only.
C.two journal entries.
D.three journal entries.
A.no journal entry.
B.one journal entry only.
C.two journal entries.
D.three journal entries.
A、Are not necessary under the perpetual system.
B、Are necessary to adjust the Inventory account to the actual inventory available.
C、Must be taken at least once a month.
D、Requires the use of hand-held portable computers.
E、Are not necessary under the cost-to benefit constraint.
A.DrSales revenue CrInventory
B.DrInventory CrCostofsales
C.DrCostofsales CrAccounts payable
D.DrCost ofsales CrInventory
A.may yield a higher inventory valuation than LIFO under a periodic inventory system when prices are steadily falling.
B.may yield a higher inventory valuation than LIFO under a periodic inventory system when prices are steadily rising.
C.always yields the same inventory valuation as LIFO under a periodic inventory system.
D.can never yield the same inventory valuation as LIFO under a periodic inventory system.
A、$36,000.
B、$36,500.
C、$42,000.
D、$37,500.
The following statements are true of LIFO except that______.
A.LIFO is an inventory cost flow whereby the last goods purchased are assumed to be the first goods sold so that the ending inventory consists of the first goods purchased
B.cost of goods sold is determined from the most recent purchase cost
C.cost of ending stock is determined from the earliest costs paid for the inventory items
D.when LIFO is used, cost of goods sold and ending stock will be the same under the periodic and perpetual system
A、$36,000.
B、$42,000.
C、$36,500.
D、$37,500.
1. Prepare journal entries to record the following merchandise transactions of Geo Company, which applies the perpetual inventory system. May 1 Purchased merchandise from Amok Company for $11,200 under credit terms of 2/15, n/45, FOB destination, and invoice dated May 1. 3 Sold merchandise to Lawton for $8,000 under credit terms of 1/10, n/30, FOB destination, invoice date May 3. The merchandise had cost $5,000. 5 Paid $350 cash for shipping charges related to the May 3 sale. 6 Returned $2,000 of the merchandise purchased on May 1 to Amok Company. 7 Lawton returned merchandise from the May 3 sale that had cost Geo $625 and had been sold for $1,000. The merchandise was restored to inventory. 13 Received the balance due from Lawton less the return. (note: 1% sales(cash) discount) 14 Paid the amount due Amok Company. (note:2% purchanse discount)
(b) You are the audit manager of Jinack Co, a private limited liability company. You are currently reviewing two
matters that have been left for your attention on the audit working paper file for the year ended 30 September
2005:
(i) Jinack holds an extensive range of inventory and keeps perpetual inventory records. There was no full
physical inventory count at 30 September 2005 as a system of continuous stock checking is operated by
warehouse personnel under the supervision of an internal audit department.
A major systems failure in October 2005 caused the perpetual inventory records to be corrupted before the
year-end inventory position was determined. As data recovery procedures were found to be inadequate,
Jinack is reconstructing the year-end quantities through a physical count and ‘rollback’. The reconstruction
exercise is expected to be completed in January 2006. (6 marks)
Required:
Identify and comment on the implications of the above matters for the auditor’s report on the financial
statements of Jinack Co for the year ended 30 September 2005 and, where appropriate, the year ending
30 September 2006.
NOTE: The mark allocation is shown against each of the matters.
Visitors to St Paul's Cathedral are surprised when they look at Johnson's statue because ______.
A.they don't expect it to be there
B.it's dressed in Roman costume
C.it's situated in the dome
D.it's dressed in eighteenth-century costume
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