[The Following Information Applies to the Questions Displayed Below

question 22

Multiple Choice

[The following information applies to the questions displayed below.]
200 At the end of last year,Games-2-Use had merchandise costing $140,000 in inventory.During January of the current year,the company purchased merchandise costing $102,000,and sold merchandise that it had purchased at a total cost of $84,000.Games-2-Use uses a perpetual inventory system.
-The amount of goods transferred from the Inventory account to the Cost of Goods Sold account during January was:

• A)$0.
• B)$84,000.
• C)$102,000.
• D)$56,000.

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Definitions:

GAAP

Generally Accepted Accounting Principles, the standard framework of guidelines for financial accounting.

Capital Lease

A long-term lease agreement that designates the lessee (the person who rents the asset) as having the financial responsibilities and benefits of ownership.

Long-Term Asset

A long-term asset is an asset that is not expected to be converted into cash within a year and is used over a long period, such as property, plant, and equipment.

Intangible Asset

An asset that lacks physical substance and usually is very hard to evaluate, such as patents, trademarks, and copyrights.