Exhibit 21-1 Refer to Exhibit 21-L

question 117

Multiple Choice

Exhibit 21-1 Refer to Exhibit 21-l. The numbers that go in blanks (E) and (F) are, respectively,

• A)25 and 20.
• B)20 and 22.
• C)15 and 10.
• D)22 and 20.

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Definitions:

Sales Returns

Goods returned by customers to the seller after the sale, which result in a reduction of revenue previously recognized.

Adjusting Entry

A journal entry made in accounting records at the end of an accounting period to allocate income and expenditure to the correct periods.

Periodic Inventory System

An inventory accounting system where the inventory count is physically conducted at specific intervals, typically at the end of an accounting period.

Net Method

An accounting method that records purchases and sales of inventory net of discounts at the time of transaction.