Computers for You Is a Retailer Specializing in Selling Computers

question 91

Multiple Choice

Computers For You is a retailer specializing in selling computers and related equipment.During 2011, Computers For You sells $200,000 of merchandise to Sandcastles, Inc.Computers For You incurs $24,000 of freight costs associated with these sales.Which of the following is true regarding how this $24,000 is treated on the financial statements?

• A)Computers For You will report the $24,000 as part of merchandise inventory on the statement of financial position.
• B)Sandcastles, Inc.will report the $24,000 as part of merchandise inventory on the statement of financial position.
• C)Computers For You will report the $24,000 as part of operating expenses on the income statement.
• D)Sandcastles, Inc.will report the $24,000 as an accounts receivable on the statement of financial position.

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Definitions:

Standard Deviation

A statistical measure that represents the dispersion or variability within a data set, indicating how spread out the numbers are from the mean.

Predictor Variables

Variables that are used in statistical models to predict scores or outcomes of another variable of interest.

Multiple Correlation

A correlation between one variable and a combined set of predictor variables.

Criterion Variable

The variable/score that is predicted based upon an individual’s score on another variable (the predictor variable).