Multiple Choice Answers

Sales to customers who use bank credit cards, such as MasterCard and Visa, are generally treated as:
a. sales on account
b. sales returns
c. cash sales
d. sales when the credit card company remits the cash
Using a perpetual inventory system, the sale of merchandise on account:
a. decreases Sales
b. increases to Merchandise Inventory
c. decreases Merchandise Inventory
d. decreases Accounts Receivable
Which of the following is NOT considered when figuring net purchases?
a. Cost of goods sold
b. Purchase returns
c. Purchases discounts
d. Purchases

“Brand name” recognition is an example of goodwill.

True
False

For a corporation, stockholders’ equity consists of __________.
a. Assets plus liabilities
b. Current assets plus long-term assets
c. Intangible assets
d. Capital stock and retained earnings