The Following Pertains to Periodic Inventory: on a Merchandising Income

question 15

Multiple Choice

The following pertains to periodic inventory: On a merchandising income statement,which would NOT be found under the heading of Cost of goods sold?

• A) Supplies
• B) Freight-in
• C) Purchases returns and allowances
• D) Purchases

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Definitions:

Liquidated Debt

Debt for which there is no dispute between the parties about the fact that money is owed and the amount of money owed.

Enforceable Accord

An agreement that is legally binding and can be upheld in court.

Consideration

Something of value that is given by both parties to a contract as the agreed-upon price or exchange for the contractual promises.

Valid Consideration

An essential element of a contract, which constitutes something of value exchanged between the contracting parties.