ACC 231 ASU Exam 2 Wolfe Question and
answers already passed 2025/2026
Journal Entry for Purchasing Inventory from a Supplier - Answer--DR Inventory $
CR Cash/Accounts Payable $
Journal Entry for Returning Items to a Supplier - Answer--DR Accounts Payable or Cash
$
CR Inventory $
Recording Sale of Inventory to Customers - Answer--must have a journal entry for
recording revenue and one for the COGS
Journal Entry for Sale of Inventory (recording revenue) - Answer--DR Cash or Accounts
Receivable $
CR Revenue $
Journal Entry for Sale of Inventory (recording COGS) - Answer--DR COGS $
CR Inventory $
Recording Customer Returns - Answer--must have a journal entry for the sales return
transaction and one for the returned inventory
Journal Entry for Customer Returns (recording sales return) - Answer--DR Sale Returns
and Allowances $
CR Cash or Accounts Receivable $
, Journal Entry for Customer Returns (recording returned inventory) - Answer--DR
Inventory $
CR COGS $
Formula for Calculating a Sales Discount/Purchase Discount - Answer--dollar amount x
% = the discount
Meaning of 5/20, n30 - Answer--5% discount on purchase if the amount is paid within 20
days of the purchase, otherwise the full amount is due in 30 days
Freight Shipping - Answer---when freight is involved the shipping terms are usually Free
on Board Shipping Point or Free on Board Destination
-specifies when title changes hands
Free On Board (FOB) Shipping Point - Answer---title changes hands as soon as the
shipment/goods leave the supplier's warehouse
-buyers pay for the freight because the costs can be directly attributed to specific goods
-freight costs are often attached to the COGS that are being shipped
Free on Board (FOB) Destination - Answer---title changes hand as soon as the
shipment arrives at the destination
-typically the seller pays freight charges and would record these costs as Delivery
Expenses
Single-Step Income Statement - Answer---offer a very straightforward accounting of a
company's business activity
-details revenues and expenses and results in the Net Income
Multi-Step Income Statement - Answer--offers detailed information about the gross profit
and operating profit of a company and shows the various sources of revenues and
expenses
Items on Multi-Step Income Statement - Answer--Sales, net
COGS
Gross profit
Total operating expenses
Operating income
Interest expenses
Net income
answers already passed 2025/2026
Journal Entry for Purchasing Inventory from a Supplier - Answer--DR Inventory $
CR Cash/Accounts Payable $
Journal Entry for Returning Items to a Supplier - Answer--DR Accounts Payable or Cash
$
CR Inventory $
Recording Sale of Inventory to Customers - Answer--must have a journal entry for
recording revenue and one for the COGS
Journal Entry for Sale of Inventory (recording revenue) - Answer--DR Cash or Accounts
Receivable $
CR Revenue $
Journal Entry for Sale of Inventory (recording COGS) - Answer--DR COGS $
CR Inventory $
Recording Customer Returns - Answer--must have a journal entry for the sales return
transaction and one for the returned inventory
Journal Entry for Customer Returns (recording sales return) - Answer--DR Sale Returns
and Allowances $
CR Cash or Accounts Receivable $
, Journal Entry for Customer Returns (recording returned inventory) - Answer--DR
Inventory $
CR COGS $
Formula for Calculating a Sales Discount/Purchase Discount - Answer--dollar amount x
% = the discount
Meaning of 5/20, n30 - Answer--5% discount on purchase if the amount is paid within 20
days of the purchase, otherwise the full amount is due in 30 days
Freight Shipping - Answer---when freight is involved the shipping terms are usually Free
on Board Shipping Point or Free on Board Destination
-specifies when title changes hands
Free On Board (FOB) Shipping Point - Answer---title changes hands as soon as the
shipment/goods leave the supplier's warehouse
-buyers pay for the freight because the costs can be directly attributed to specific goods
-freight costs are often attached to the COGS that are being shipped
Free on Board (FOB) Destination - Answer---title changes hand as soon as the
shipment arrives at the destination
-typically the seller pays freight charges and would record these costs as Delivery
Expenses
Single-Step Income Statement - Answer---offer a very straightforward accounting of a
company's business activity
-details revenues and expenses and results in the Net Income
Multi-Step Income Statement - Answer--offers detailed information about the gross profit
and operating profit of a company and shows the various sources of revenues and
expenses
Items on Multi-Step Income Statement - Answer--Sales, net
COGS
Gross profit
Total operating expenses
Operating income
Interest expenses
Net income
