A Merchandiser Had Sales Returns and Allowances of $300, Sales

question 100

Multiple Choice

A merchandiser had sales returns and allowances of $300, sales discounts of $700, cost of goods sold of $12,000, and all other expenses of $4,500. The merchandiser uses a perpetual inventory system. The second entry in the closing process would include:

• A)a debit to Income summary for $17,500.
• B)a credit to Income summary for $16,500.
• C)a debit to Income summary for $4,500.
• D)a debit to Income summary for $16,500.

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Definitions:

Market Structure

The organizational and other characteristics of a market that significantly affect the nature of competition and pricing within the market.

Product Diversity

The range of different products or services offered by a company or available in a market.

Monopolistic Competition

Monopolistic competition is a market structure characterized by many firms offering differentiated products or services, with some degree of market power due to product differentiation.

Offset Inefficiency

A situation where the costs of implementing a policy or project exceed the benefits, leading to suboptimal outcomes or wasted resources.