Sampson Company's Accounting Records Show the Following for the Year

question 108

Multiple Choice

Sampson Company's accounting records show the following for the year ending on December 31, 2014. $$\begin{array} { l r } \text { Purchase Discounts } & \$ , 600 \\\text { Freight-In } & 7,800 \\\text { Purchases } & 350,010 \\\text { Beginning Inventory } & 23,500 \\\text { Ending Inventory } & 28,800 \\\text { Purchase Returns and Allowances } & 6,400\end{array}$$ Using the periodic system, the cost of goods purchased is

• A) $330,210.
• B) $354,210.
• C) $358,610.
• D) $345,810.

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Definitions:

Use of Leverage

The practice of using borrowed money to increase the potential return of an investment, which also increases the risk of loss.

Diluting Existing Shares

A process where a company issues more shares, leading to a reduction in the ownership percentage of existing shareholders.

Public Utility

A company providing essential services such as water, electricity, and telecommunications to the public, often subject to government regulation.

Fundamental Analysis

An approach to evaluating a security that involves analyzing economic, financial, and other qualitative and quantitative factors.