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QUESTION $14$

Merchandise inventory is classified on the balance sheet as a

a$.$ long$-$term liability

b$.$ current liability

c$.$ current asset

d$.$ long$-$term asset

QUESTION $15$

Gross profit is equal to

a$.$ Net sales less cost of goods sold

b$.$ Net sales plus cost of goods sold

c$.$ Net sales less sales discounts and sales allowances

d$.$ Net sales plus selling expenses

QUESTION $16$

The statement of owner's equity shows

a$.$ beginning and ending capital, all the changes in the owner's capital as a result of net income $($loss$),$ and withdrawals

b$.$ only net income, beginning capital, and withdrawals

c$.$ only net income and beginning and ending capital

d$.$ only total assets and beginning and ending capital

QUESTION $17$

Inventory shrinkage is recorded when

a$.$ merchandise is returned to a seller

b$.$ there is a difference between a physical count of inventory and inventory records

c$.$ merchandise purchased from a seller is incomplete or short

d$.$ merchandise is returned by a buyer

QUESTION $18$

A retailer purchases merchandise with a catalog list price of $$30,000.$ The retailer receives a $15\%$ trade discount and has credit terms of $\frac{2}{10},\frac{n}{30}.$ How much cash will be needed to pay this invoice within the discount period?

a$.$ $$24,990$

b$.$ $$30,000$

c$.$ $$29,400$

d$.$ $$24,900$

Use the information below to answer the following questions.

Boxwood Company sells blankets for $$60$ each. The following was taken from the inventory records during May. The company had no beginning inventory on May $1.$

$\backslash$table$[[$Date$,$Blankets,Units,Cost$],[$May $3,$Purchase,$5,$$$20$

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