Multiple Choice Answers

The difference between sales and cost of merchandise sold for a merchandising business is:

a. Sales
b. Net Sales
c. Gross Sales
d. Gross Profit
If Assets have a balance of $50,000, and Stockholders’ Equity has a balance of $40,000, then Liabilities must have a balance of __________.

a. $90,000
b. $20,000
c. $40,000
d. $10,000
If a $10,000 sale is made on January 1st, with terms of 2/10, n/30 how much would the discount be if payment is made on January 9th?

a. $10,000
b. $200
c. $1,000
d. $0
A sales invoice included the following information: merchandise price, $6,000; transportation, $300; terms 2/10, n/eom, FOB shipping point. Assuming that a credit for merchandise returned of $600 is granted prior to payment, that the transportation is paid by the buyer, and that the invoice is paid within the discount period, what is the amount of cash received by the seller?

a. $5,880
b. $5,292
c. $5,586
d. $5,592

Young Company has $16,000 in Retained Earnings, $27,000 in Assets, and $5,000 in Liabilities. How much is in Common Stock?

a. $36,000.
b. $15,000.
c. $5,000.
d. $6,000.