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The return of merchandise was recorded as a debit to Accounts Receivable and a credit to

The return of merchandise was recorded as a debit to Accounts Receivable and a credit to

 The return of merchandise was recorded as a debit to Accounts Receivable and a credit to Purchases Returns and Allowances. This error will cause

A) net income to be overstated.

B) net income to be understated.

C) total liabilities to be understated.

D) total assets to be overstated.

 

22) A form used in business to place an order for the buying of goods from a seller is

A) purchase requisition.

B) purchase order.

C) purchase discount.

D) purchases returns.

 

23) A purchase discount correctly taken was debited to Purchases at the time the entry was recorded. This error will cause

A) net income to be overstated.

B) net income to be understated.

C) net income to not be affected.

D) total assets to be overstated.

24) Purchased office supplies on account. This will be recorded with

A) a debit to Accounts Payable and a credit to Supplies.

B) a debit to Supplies and a credit to Supplies Expense.

C) a debit to Supplies and a credit to Accounts Payable.

D) a credit to Supplies and a debit to Purchases.

 

25) A characteristic of Purchases is that

A) it has a debit normal balance.

B) it reduces net income.

C) it is used to record the purchase of merchandise to be resold.

D) All of the above are correct.

 

 

26) Which of the following transactions will cause one asset to be debited and another to be credited when the periodic inventory system is in use?

A) Purchased merchandise on account

B) Purchased merchandise for cash.

C) Purchased office supplies for cash

D) Purchased office supplies on account

 

27) Which of the following transactions will cause a liability to be credited and a cost account to be debited when the periodic inventory system is in use?

A) Recorded the adjustment for amortization

B) Recorded the adjustment for the consumption of supplies

C) Purchased merchandise inventory on account

D) Purchased office supplies on account

 

28) Purchases

A) decrease net income.

B) increase net income.

C) have no effect on net income.

D) Not enough information provided.

29) Purchases discounts

A) decrease net income.

B) increase net income.

C) have no effect on net income.

D) Not enough information provided.

 

30) Purchases Returns and Allowances

A) decrease net income.

B) increase net income.

C) have no effect on net income.

D) Not enough information provided.

Tripti 06-Dec-2019

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