Question

Question 24 2.5 pts

What inventory method is used when the inventory balance is updated only at the end of the accounting period?

Income Summary

Perpetual

Cost of Goods Sold

Periodic

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Question 25 2.5 pts

When using a periodic inventory method, what account is increased when you buy merchandise inventory?

Beginning Inventory

Supplies

Purchases

Cost of Goods Sold

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Question 26 2.5 pts

Cost of Goods Sold equals:

Beginning Inventory - Net Purchases + Freight-in + Ending Inventory.

Beginning Inventory + Net Purchases + Freight-in - Ending Inventory.

Beginning Inventory + Net Purchases + Freight-in + Freight-out + Ending Inventory.

Beginning Inventory - Net Purchases - Freight-in + Ending Inventory.

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Question 27 2.5 pts

Net Income equals:

Net Sales - Cost of goods sold - Operating expenses.

Gross Profit - Operating expenses.

All of the above are correct.

Sales - Sales Returns & Allowances - Sales Discount - Cost of goods sold - Operating Expenses.

Answer 1

Ans 24) in case of periodic inventory, inventory balance is updated only at the end of accounting period.

So correct answer is periodic system.

And 25) whenever we buy inventory it will lead to increase in the purchases account.

So correct answer is purchases.

Ans 26) cost of goods sold is equal to opening stock + purchases + freight- closing stock

So correct answer is. Beginning inventory + net purchases + Freight in - ending inventory

Ans 27) All the answers are correct because sales- cost of goods sold is gross profit and when we deduct operating expenses from it the resultant will be net income.

So correct answer is All of the above are correct