Day 100: Review for Ch 5 Quiz

1. How would a service business report revenues from providing a service? 
2. What is the formula to calculate Net Income for a merchandising business?
3. How is Inventory classified on the Balance Sheet?
4. Under the periodic method what is the formula to calculate Net Sales for a merchandiser?
5. What is it called when a seller grants credit to customers for damaged or defective?
6. When would a seller grant a Sales Discount to a customer?
7. How do you determine the total Cost of Merchandise Purchased under the periodic method?
8. How is a Perpetual Inventory System different from a Periodic System?
9. What is another term for Income from Operations?
10. Which types of expenses would not be classified as operating expenses?
11. Which types of expenses would be considered selling expenses?
12. How would revenue from sources other than the primary operating activity be classified?
13. What do we call a separate ledger used to group together accounts with common characteristics?
14. If a customer pays with a MasterCard bank card, which account would be debited?
15. Under a perpetual inventory system, what is the journal entry for a $50 tax exempt sale?
16. What is the name of the source document that outlines the terms of a sale on account?
17. $100 sale on account (2/10 n30). How much cash is collected within and after discount period?
18. Show the journal entries for $100 sale on account made on January 10th (2/10 n/30).
    (Net Method, Perpetual and Gross Method, Periodic)
19. Which source document is typically used when a customer returns merchandise?
20. Show journal entries for $100 purchase on account with $15 freight. (Periodic and Perpetual, FOB Shipping point and FOB Destination
21. Merchandise costing $100 was previously purchased on account with credit terms of 2/10 n30. Show the journal entries using both the perpetual and periodic inventory system and if payment on account is made both within and beyond the discount period.
22. Explain the concept of FOB shipping point:
23. Explain the concept of Sales Tax:
24. What are Trade Discounts?
25. The physical inventory on hand at the end of an accounting period is usually less than the balance in the Merchandise Inventory account due to shoplifting, employee theft or error. This difference is called:
26. To adjust for differences between the physical amount of merchandise in inventory and the amount recorded in the Merchandise Inventory account an adjusting journal entry must be made. If the physical count is less than that recorded in Merchandise Inventory, this entry would: