The statement of owner's equity shows
| a. | beginning and ending capital and all the changes in the owner's capital as a result of net income (loss), and withdrawals | |
| b. | only net income, beginning capital, and withdrawals | |
| c. | only total assets, beginning and ending capital | |
| d. | only net income, beginning and ending capital |
Answer = a
What is the term applied to the excess of net revenue from sales over the cost of merchandise sold?
| a. | income from operations | |
| b. | gross sales | |
| c. | net income | |
| d. | gross profit |
Answer = d
Merchandise subject to terms 2/10, n/30, FOB shipping point, is sold on account to a customer for $25,000. What is the amount of the sales discount allowable?
| a. | $150 | |
| b. | $500 | |
| c. | $460 | |
| d. | $260 |
Answer = b
Merchandise is ordered on November 10; the merchandise is shipped by the seller and the invoice is prepared, dated, and mailed by the seller on November 13; the merchandise is received by the buyer on November 18; the entry is made in the buyer's accounts on November 20. The credit period begins with what date?
| a. | November 10 | |
| b. | November 18 | |
| c. | November 20 | |
| d. | November 13 |
Answer = b
