Merchandising Average Round

Which of the following would not be considered a merchandising company?

• 1. Retailer

• 1. Wholesaler

• 1. Service firm

• 1. Dot Com firm

A merchandising company that sells directly to consumers is a _____.

• 1. Retailer

• 1. Wholesaler

• 1. Broker

• 1. Service Company

47. The primary source of revenue for a wholesaler is ____.

• 1. investment income

• 1. service fees

• 1. the sale of merchandise

• 1. the sale of fixed assets the company owns

47. After gross profit is calculated, operating expenses are deducted to determine _____.

• 1. gross margin

• 1. net income

• 1. gross profit on sales

• 1. net margin

47. Cost of goods sold is determined only at the end of the accounting period in _____.

• 1. a perpetual inventory system.

• 1. a periodic inventory system.

• 1. both a perpetual and a periodic inventory system.

• 1. neither a perpetual nor a periodic inventory system.

47. Which of the following expressions is incorrect?

• 1. Gross profit – operating expenses = net income

• 1. Sales – cost of goods sold – operating expenses = net income

• 1. Net income + operating expenses = gross profit

• 1. Operating expenses – cost of goods sold = gross profit

47. Detailed records of goods held for resale are not maintained under a ____.

• 1. perpetual inventory system.

• 1. periodic inventory system.

• 1. double entry accounting system.

• 1. single entry accounting system.

47. A perpetual inventory system would likely be used by a(n) _____.

• 1. automobile dealership.

• 1. hardware store.

• 1. drugstore.

• 1. convenience store.

47. Which of the following is a true statement about inventory systems?

• 1. Periodic inventory systems require more detailed inventory records.

• 1. Perpetual inventory systems require more detailed inventory records.

• 1. A periodic system requires cost of goods sold be determined after each sale.

• 1. A perpetual system determines cost of goods sold only at the end of the accounting

     period.

47. In a perpetual inventory system, cost of goods sold is recorded ____.

• 1. on a daily basis.

• 1. on a monthly basis.

• 1. on an annual basis.

• 1. with each sale.