Tutorial 3

BKAL1013 BUSINESS ACCOUNTING - Semester A191
TUTORIAL 3: Chapter 5
Last date of submission: 11 November 2019
PART (A):
1. When a corporation sells merchandise and the terms are FOB shipping point and pays
the shipping costs, the seller would record the transportation costs with the following
entry:
A. debit Cash, credit Accounts Receivable.

B. debit Accounts Receivable, credit Sales.
C. debit Accounts Receivable, credit Cash.
D. debit Merchandise Inventory, credit Accounts Payable.
2. Multiple-step Income Statement:
A. shows gross profit but not income from operations.

B. shows both gross profit and income from operations.
C. shows neither gross profit nor income from operations.
D. shows income from operations but not gross profit.
3. A sales invoice included the following information: merchandise price, RM12,000;

transportation, RM500; terms 2/10, n/eom, FOB shipping point. Assuming that a credit
for merchandise returned of RM600 is granted prior to payment, that the transportation
is prepaid by the seller, and that the invoice is paid within the discount period, what is
the amount of cash received by the seller?
A. RM11,662
B. RM11,672
C. RM12,250
D. RM11,172
4. Merchandise with an invoice price of RM15,000 is purchased with terms of 3/10, n/45,
FOB shipping point. Transportation costs paid by the buyer were RM162. What is the
cost of the merchandise purchased if payment is made during the discount period?
A. RM14,712.00
B. RM14,707.14
C. RM15,162.00
D. RM15,000.00
5. When a corporation sells merchandise and the terms are FOB shipping point and pays
the shipping costs, the seller would record the transportation costs with the following
entry:
A. debit Accounts Receivable, credit Cash.

B. debit Cash, credit Accounts Receivable.
C. debit Accounts Receivable, credit Sales.
D. debit Merchandise Inventory, credit Accounts Payable.
6. A merchandiser purchases inventory on account under a perpetual inventory system with

terms of 3/15, n/45. The merchandiser would :
A. Debit Purchase Discounts on date of purchase if the discount is not taken

B. Credit Inventory on date of payment if discount is taken
C. Debit Purchase Discounts on date of purchase if the discount is taken
D. Credit Inventory on date of payment if discount is not taken
7. The credit term which allowed a 6% discount if payment is made within 15 days, net
amount due within 30 days is:
A. 15/6, n/15
B. 6/eom, n/15
C. 6/15, n/30
D. 6/6, n/30
8. Which account would the seller debit when the purchaser takes advantage of credit terms
within the discount period?
A. Sales discounts
B. Purchase discounts
C. Purchase returns and allowances
D. Sales returns and allowances
9. Firas sold merchandise on account to Fatin, RM15,000, terms FOB shipping point,
n/45. The cost of the goods sold was RM9,000. Firas paid the RM1,000 shipping costs.
In Fatin’s journal entry, what should be recorded?
RM RM
A. Account Receivable 16,000 Sales 16,000
B. Cost of Goods Sold 16,000 Inventory 15,000
C. Inventory 16,000 Account Payable 16,000
D. Inventory 15,000 Account Payable 15,000
10. The beginning balance in its inventory account is RM1,500 and the ending balance is
RM1,000. Cost of goods sold is RM6,500. What was the amount of inventory purchased
during the year?
A. RM500
B. RM6,000
C. RM7,000
D. RM7,500
PART (B):
1. The following were selected from among the transactions completed by Aish Works
during December of the current year.
Dec 3. Purchased merchandise on account from Tania Enterprise, list price RM24,000,
trade discount 25%, term FOB shipping point, 2/10, n30, with prepaid
transportation cost of RM615 added to the invoice.
5. Purchased merchandise on account from Mama Enterprise, RM10,250, terms FOB

destination, 2/10, n30.
6. Sold merchandise on account to Melati Borong, list price RM18,000, trade discount
35%, terms 2/10, n30. The cost of merchandise sold was RM8,250.
7. Returned RM1,800 of merchandise purchased on 5 December from Mama

Enterprise.
13. Paid Tania Enterprise on account for purchase of 3 December, less discount.
15. Paid Mama Enterprise on account for purchase of 5 December, less return of
December 7 and discount.
16. Received cash on account from sale of 6 December to Melati Borong, less
discount.
19. Sold merchandise on MasterCard, RM39,500. The cost of the merchandise sold
was RM23,700.
22. Sold merchandise on account to LCW Resources, RM11,300, terms 2/10, n30. The
cost of the merchandise sold was RM6,700.
23. Sold merchandise for cash, RM17,680. The cost of the merchandise sold was
RM9,100.
28. Received merchandise returned by LCW Resources from sale of 22 December,

RM2,000. The cost of the returned merchandise was RM1,100.
31. Paid MasterCard service fee of RM1,050.
REQUIRED:
Journalize the transactions.

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BKAL1013 BUSINESS ACCOUNTING - Semester A191

Last date of submission: 11 November 2019

A. debit Cash, credit Accounts Receivable.

2. Multiple-step Income Statement:

A. shows gross profit but not income from operations.

3. A sales invoice included the following information: merchandise price, RM12,000;

A. debit Accounts Receivable, credit Cash.

6. A merchandiser purchases inventory on account under a perpetual inventory system with

A. Debit Purchase Discounts on date of purchase if the discount is not taken

5. Purchased merchandise on account from Mama Enterprise, RM10,250, terms FOB

7. Returned RM1,800 of merchandise purchased on 5 December from Mama

28. Received merchandise returned by LCW Resources from sale of 22 December,

31. Paid MasterCard service fee of RM1,050.

Journalize the transactions.

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