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International accounting - CHAPTER 5 ACCOUNTING FOR MERCHANDISING OPERATIONS SUMMARY OF QUESTIONS BY STUDY OBJECTIVES AND BLOOM’S TAXONOMY

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CHAPTER 5 ACCOUNTING FOR MERCHANDISING OPERATIONS SUMMARY OF QUESTIONS BY STUDY OBJECTIVES AND BLOOM’S TAXONOMY 1. Identify the differences between service and merchandising companies. Because of inventory, a merchandising company has sales revenue, cost of goods sold, and gross profit. To account for inventory, a merchandising company must choose between a perpetual and a periodic inventory system. 2. Explain the recording of purchases under a perpetual inventory system. The company debits the Merchandise Inventory account for all purchases of merchandise, freight-in, and other costs, and credits it for purchase discounts and purchase returns and allowances. 3. Explain the recording of sales revenues under a perpetual inventory system. When a merchandising company sells inventory, it debits Accounts Receivable (or Cash) and credits Sales for the selling price of the merchandise. At the same time, it debits Cost of Goods Sold and credits Merchandise Inventory for the cost of the inventory items sold. 4. Explain the steps in the accounting cycle for a merchandising company. Each of the required steps in the accounting cycle for a service company applies to a merchandising company. A worksheet is again an optional step. Under a perpetual inventory system, the company must adjust the Merchandise Inventory account to agree with the physical count. 5. Distinguish between a multiple-step and a single-step income statement. A multiple-step income statement shows numerous steps in determining net income, including nonoperating activities sections. A single-step income statement classifies all data under two categories, revenues or expenses, and determines net income in one step. 6. Explain the computation and importance of gross profit. Merchandising companies compute gross profit by subtracting cost of goods sold from net sales. Gross profit represents the merchandising profit of a company. Managers and other interested parties closely watch the amount and trend of gross profit. a7. Explain the recording of purchases and sales of inventory under a periodic inventory system. In recording purchases under a periodic system, companies must make entries for (a) cash and credit purchases, (b) purchase returns and allowances, (c) purchase discounts, and (d) freight costs. In recording sales, companies must make entries for (a) cash and credit sales, (b) sales returns and allowances, and (c) sales discounts.

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lOMoARcPSD|25973474




Ch05-2


International accounting (‫)جامعة الشارقة‬

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CHAPTER 5
ACCOUNTING FOR MERCHANDISING OPERATIONS

SUMMARY OF QUESTIONS BY STUDY OBJECTIVES AND BLOOM’S
TAXONOMY
Item SO BT Item SO BT Item SO BT Item SO BT Item SO BT
True-False Statements
sg
1. 1 C 10. 3 C 19. 5 K 28. 6 K 37. 2 K
sg
2. 1 C 11. 3 C 20. 5 K 29. 6 K 38. 3 K
sg
3. 1 K 12. 3 K 21. 5 C 30. 7 K 39. 3 K
sg
4. 2 K 13. 4 C 22. 5 C 31. 7 K 40. 4 C
a sg
5. 2 K 14. 4 K 23. 5 C 32. 7 K 41. 5 K
a sg
6. 2 K 15. 4 K 24. 5 K 33. 7 K 42. 6 K
a
7. 2 K 16. 5 K 25. 5 K 34. 8 K
sg
8. 3 C 17. 5 K 26. 6 AP 35. 1 K
sg
9. 3 C 18. 5 K 27. 6 K 36. 1 K
Multiple Choice Questions
43. 1 K 70. 2 AP 97. 3 C 124. 6 AP 151. 7 C
a
44. 1 K 71. 2 K 98. 3 C 125. 6 AP 152. 7 K
a
45. 1 C 72. 2 AP 99. 3 AP 126. 6 K 153. 7 K
a
46. 1 K 73. 2 AP 100. 3 AP 127. 6 C 154. 7 K
a
47. 1 K 74. 3 AP 101. 3 AP 128. 6 K 155. 7 AP
a
48. 1 C 75. 3 AP 102. 3 K 129. 6 K 156. 7 AP
a
49. 1 K 76. 3 AP 103. 3 K 130. 6 AP 157. 7 K
a
50. 1 K 77. 3 C 104. 3 C 131. 6 AP 158. 7 C
a
51. 1 C 78. 3 C 105. 3 C 132. 6 AP 159. 7 C
a
52. 1 K 79. 3 AP 106. 3 K 133. 6 AP 160. 7 K
a
53. 2 C 80. 3 AP 107. 3 K 134. 6 AP 161. 7 K
a
54. 2 C 81. 3 C 108. 4 C 135. 6 AP 162. 7 C
a
55. 2 C 82. 3 C 109. 4 C 136. 6 AP 163. 8 K
a
56. 3 K 83. 3 C 110. 4 K 137. 6 AP 164. 8 K
sg
57. 3 C 84. 3 K 111. 4 C 138. 6 AP 165. 1 AP
sg
58. 2 K 85. 3 K 112. 4 C 139. 6 AP 166. 2 K
sg
59. 2 K 86. 3 C 113. 5 AP 140. 6 AP 167. 2 K
st
60. 2 C 87. 3 C 114. 5 K 141. 6 AP 168. 2 K
sg
61. 2 K 88. 3 K 115. 5 C 142. 6 AP 169. 3 K
st
62. 2 C 89. 3 K 116. 5 C 143. 6 AP 170. 4 K
sg
63. 2 C 90. 3 C 117. 5 C 144. 6 AP 171. 6 AP
st
64. 2 C 91. 3 K 118. 5 AP 145. 6 AP 172. 5 K
a sg
65. 2 AP 92. 3 AP 119. 5 K 146. 7 AP 173. 6 K
a
66. 2 AP 93. 3 C 120. 5 C 147. 7 AP a,st174 7 K
a
67. 2 C 94. 3 C 121. 5 K 148. 7 AP
68. 2 K 95. 3 C 122. 5 K 149. 7 AP
69. 2 AP 96. 3 C 123. 5 K 150. 7 AP
sg This question also appears in the Study Guide.
st This question also appears in a self-test at the student companion website.

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5-2 Test Bank for Accounting Principles, Ninth Edition

a This question covers a topic in an appendix to the chapter.




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Accounting for Merchandising Operations 5-3

SUMMARY OF QUESTIONS BY STUDY OBJECTIVES AND BLOOM’S
TAXONOMY
Brief Exercises
175. 1 AP 178. 3 AP 181. 5 AP 184. 7 AP
176. 2 AP 179. 3 AP 182. 6 AP 185. 7 AP
a
177. 2,3 AP 180. 4 AP 183. 7 AP 186. 7 AP
Exercises
a
187. 1 C 192. 2,3 AN 197. 4 AP 202. 5,6 AP 207. 7 AP
a
188. 2,3 AP 193. 2 AP 198. 4 AP 203. 5,6 C 208. 7 AP
a
189. 2,3 AP 194. 3 AP 199. 5 AN 204. 5,6 AP 209. 7 AP
a
190. 2 E 195. 3 AP 200. 5,6 AP 205. 5,6 AP 210. 8 AP
a a
191. 2,3 AP 196. 4 AP 201. 5,6 AP 206. 7 AP 211. 7 AP
Completion Statements
212. 1 K 214. 1 K 216. 2 K 218. 3 K 220. 6 K
213. 1 K 215. 2 K 217. 3 K 219. 3 K 221. 6 K
Matching Statements
222. 1 K
Short-Answer Essay
223. 3 K 225. 3 K 227. 1 K 229. 1 K
224. 1 K 226. 5 K 228. 5 K 230. 1 K


SUMMARY OF STUDY OBJECTIVES BY QUESTION TYPE
Item Type Item Type Item Type Item Type Item Type Item Type Item Type
Study Objective 1
1. TF 36. TF 46. MC 50. MC 175. BE 214. C 229. SA
2. TF 43. MC 47. MC 51. MC 187. Ex 222. MA 230. SA
3. TF 44. MC 48. MC 52. MC 212. C 224. SA
35. TF 45. MC 49. MC 165. MC 213. C 227. SA
Study Objective 2
4. TF 54. MC 62. MC 68. MC 156. MC 189. Ex 216. C
5. TF 55. MC 63. MC 69. MC 157. MC 190. Ex
6. TF 58. MC 64. MC 70. MC 158. MC 191. Ex
7. TF 59. MC 65. MC 71. MC 166. BE 192. Ex
37. TF 60. MC 66. MC 72. MC 167. BE 193. Ex
53. MC 61. MC 67. MC 73. MC 188. Ex 215. C
Study Objective 3
8. TF 57. MC 81. MC 89. MC 97. MC 105. MC 189. Ex
9. TF 74. MC 82. MC 90. MC 98. MC 106. MC 191. Ex
10. TF 75. MC 83. MC 91. MC 99. MC 107. MC 194. Ex
11. TF 76. MC 84. MC 92. MC 100. MC 169. MC 195. Ex
12. TF 77. MC 85. MC 93. MC 101. MC 177. BE 217. C
38. TF 78. MC 86. MC 94. MC 102. MC 178. BE 218. C
39. TF 79. MC 87. MC 95. MC 103. MC 179. BE 219. C
56. MC 80. MC 88. MC 96. MC 104. MC 188. Ex 225. SA




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