Cumberland Co. sells $2,000 of inventory to Hancock Co. for cash. Cumberland paid $1,250 for the merchandise

1. Cumberland Co. sells $2,000 of inventory to Hancock Co. for cash. Cumberland paid $1,250 for the merchandise. Under a perpetual inventory system, which of the following journal entry(ies) would be recorded?

	a.	debit Cash, $1,250; credit Sales, $1,250
	b.	debit Accounts Receivable, $2,000; credit Sales, $2,000; and debit Cost of Merchandise Sold, $1,250; credit Merchandise Inventory, $1,250
	c.	debit Cash, $2,000; credit Merchandise Inventory, $1,250
	d.	debit Cash, $2,000; credit Sales, $2,000; and debit Cost of Merchandise Sold, $1,250; credit Merchandise Inventory, $1,250

Answer = d

1. Taking advantage of a 2/10, n/30 purchases discount is equal to a savings yearly rate of approximately

	a.	36%
	b.	20%
	c.	24%
	d.	2%

Answer = a

1. Sales to customers who use bank credit cards such as MasterCard and Visa are usually recorded by a

	a.	debit to Sales, debit to Credit Card Expense, and a credit to Cash
	b.	debit to Cash and a credit to Sales
	c.	debit to Cash, credit to Credit Card Expense, and a credit to Sales
	d.	debit to Bank Credit Card Sales, debit to Credit Card Expense, and a credit to Sales

Answer = b