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Kisachek [45]
3 years ago
10

ABC purchases inventory for $2,000 and incurs shipping costs of $100 for the goods to be delivered. To record this transaction,

the company debits Inventory for $2,000, debits Selling Expenses for $100, and credits Cash for $2,100. Which of the following statements is correct?
A) Revenues are understated.
B) All accounts are accurately stated.
C) Net income is overstated.
D) Assets are understated.
Specific Identification is used by:
A) Starbucks
B) Manufacturers
C) Grocery Stores
D) Car dealers
Business
1 answer:
Rus_ich [418]3 years ago
6 0

Answer: 1. D) Assets are understated

2. D) Car dealers

Explanation:

1. The shipping costs to bring Inventory into a business are known as Carriage Inwards. This amount is to be debited with the Inventory as it is considered to be part of the cost of acquiring the inventory. By not putting this cost with the inventory, ABC is undervaluing the inventory account which is an Asset account. The Assets are therefore understated.

2. The Specific Identification Method of inventory valuation is based on each individual unit purchased or sold. It does not group items and tracks each item from the moment it is purchased to the moment it is sold so the cost of the specific inventory is known. This method is used more often by businesses that deal with easily identifiable items such as Jewellers and Car dealers because each car is big enough to be tracked individually.

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I think the answer is A
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3 years ago
Roberta transfers property with a tax basis of $400 and a fair market value of $500 to a corporation in exchange for stock with
trapecia [35]

Answer: the correct answer is A. $500

Explanation:

Amount realized is the amount received from the sale of an asset. The money received for Roberta is $500.

7 0
3 years ago
Alina received $60 in the mail from her grandparents to buy whatever she wanted. She decided she could spend all of it on 4 t-sh
faust18 [17]

Answer:

(c) 7.5 bars, 2/15 shirts

Explanation:

Opportunity cost is simply defined as the next best alternative.

Opportunity cost also refers to the loss of foregone gain which could have resulted had a non chosen option been selected over the chosen option. For instance, the opportunity cost of storing money at home is the average market rate of interest which would've been earned had the same money been invested.

In the given question, the opportunity cost of a t shirt would be :

= \frac{30\ Protein\ Bars}{4\ T\ Shirts}

= 7.5 protein bars

Similarly, the opportunity cost for a protein bar would be:

= \frac{4\ T\ Shirts}{30\ Protein\ Bars}

= \frac{2}{15} \ T\ Shirts

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4 0
2 years ago
The goal of total quality management (TQM) is to:a) outsource manufacturing tasks to overseas businesses.b) offer customers more
Greeley [361]

Answer: Option D  

                         

Explanation: In simple words, it refers to an implemented structure under which every employee of the organisation works to maintain high standards of performance in every aspect of the operations.

In other words, it refers to the organisation wide efforts under which all employees works for the betterment of the organisation.

Hence from the above we can conclude that the correct option is D.

5 0
2 years ago
Grey Wolf, Inc., has current assets of $2,090, net fixed assets of $9,830, current liabilities of $1,710, and long-term debt of
Naya [18.7K]

Answer and Explanation:

The computation is shown below:

1. Before computing the stockholder equity first we have to determine the total assets and the total liabilities which is shown below:

As we know that

Total Assets = Current Assets + Net Fixed Assets

= $2,090 + $9,830

= $11,920

Now

Total Liabilities = Current Liabilities + Long-term Debt

= $1,710 + $4,520

= $6,230

So,

Stockholders’ Equity = Total Assets - Total Liabilities

= $11,920 - $6,230

= $5,690

2. The net working capital is

Net Working Capital = Current Assets - Current Liabilities

=  $2,090 - $1,710

= $380

5 0
3 years ago
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