In periods of rising prices. what will lifo produce?

In periods of rising prices, LIFO will produce(multiple choice): (A) higher net income than FIFO (B)the same net income as FIFO (C)lower net income than FIFO (D)higher net income than average-cost -The sales accounts that normally have a debit balance are: A)Sales Discount (B)Sales Returns and Allowances (C) both a and b (D)neither a or b -A credit sale of $750 is made on June 13.it would turn of $50 is granted on June 16. The amount received as payment in full on June 23 is: A)$700 (B)$686 (C)$685 (D)$650 -Which of the following accounts will normally a pair in the ledger of the merchandising company that uses a perpetual inventory system? A)purchases (B)freight in (C)cost of good sold (D)purchase discounts -To record the sale of goods for cash in a perpetual inventory system: A)only one journal entry is necessary to record cost of goods sold and reduction of inventory (B)only one journal entry is necessary to record the receipt of cash and the sales revenue (C) two journal entries are necessary went to record the receipt of cash in sales revenue and want to record the cost of good sold and reduction of inventory (D)to journal entries are necessary want to record receipt of cash and reduction of inventory and want to record the cost of good sold and sales revenue

Answer

solution 1: In periods of rising prices, LIFO will produce “lower net income than FIFO” Hence option C is correct. solution 2: The sales accounts that normally have a debit balance are: 1. Sales discount 2. Sales return and allowances Hence option c “both a and b” is correct. Solution 3: The amount received as payment in full on June 23 is = $750 – $50 = $700 Hence option A is correct. Solution 4: “cost of good sold” accounts will normally appear in the ledger of the merchandising company that uses a perpetual inventory system. Hence option C is correct. Solution 5: o record the sale of goods for cash in a perpetual inventory system “two journal entries are necessary went to record the receipt of cash in sales revenue and want to record the cost of good sold and reduction of inventory”

Hence option C is correct.

Leave a Comment