Question

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Washington Warehouse is a small retail business that specializes in the sale of top-of-the-line televisions. This year, the store has begun to carry the Flat TV manufactured by Bass Co. Thus far, Washington has recorded the following transactions involving the Flat TV:

Jan.	5		Purchased 8 Flat TVs at a unit cost of $1,400
Jan.	18		Purchased 5 additional Flat TVs at $1,400 each
Feb.	12		Sold 9 Flat TVs to the Duke Hotel for $15,300

If Washington uses a perpetual inventory system, the journal entry to record the purchase on January 18th would include which of the following?

Multiple Choice

• A debit to Inventory for $7,000.

• A credit to Inventory for $7,000.

• A debit to the Cost of Goods Sold for $7,000.

• A debit to the Purchases account for $7,000.

If Washington uses a perpetual inventory system, the gross profit on the Flat TVs as of February 12th is:

Multiple Choice

• $11,200.

• $2,700.

• $15,300.

• $4,100.

If Washington uses a perpetual inventory system, the journal entry to record the sale on February 12th would include all of the following except:

rev: 04_19_2019_QC_CS-166574

Multiple Choice

• A credit to Inventory for $12,600.

• A credit to Purchases for $15,300.

• A debit to the Cost of Goods Sold for $12,600.

• A credit to Sales Revenue for $15,300.

Washington maintains a subsidiary ledger account for each type of TV carried in the store. An examination of the account for the Flat TV model at the end of February would show:

Multiple Choice

• The amount that Washington owes to Bass.

• 13 units on hand with a total value of $18,200.

• 4 units on hand with a total value of $5,600.

• 4 units on hand with a total value of $1,400.

Answer 1