Merchandising Operations

CHAPTER 5

Merchandising Operations and the Multiple-Step Income Statement

Study Objectives

1. 2. 3. 4. 5. 6. 7. *8. Identify the differences between a service company and a merchandising company. Explain the recording of purchases under a perpetual inventory system. Explain the recording of sales revenues under a perpetual inventory system. Distinguish between a single-step and a multiple-step income statement. Determine cost of goods sold under a periodic system. Explain the factors affecting profitability. Identify a quality of earnings indicator. Explain the recording of purchases and sales of inventory under a periodic inventory system.

Summary of Questions by Study Objectives and Bloom’s Taxonomy

Item 1. 2. 3. 4. 5. 6. 1. 2. 3. 1. 1. 2. 3. 1. 2. SO 1 1 1 1 1 3 1, 4 2, 3 3 2 3 2, 3 2 2, 3, 4, 6 2, 3 BT C C C C AP C AP AP AP AP AP AP AP Item 7. 8. 9. 10. 11. SO 3 3 3 3 2 BT K AP C C AP Item 12. 13. 14. 15. 16. SO 4 3 4 4 1 BT AP C C K K Item 17. 18. 19. 20. 21. SO 4 2 2 5 5 BT K K K K K Item 22. 23. 24. 25. 26. SO 6 6 6 7 8* BT K C AN C AP Questions

Brief Exercises 4. 5. 6. 2. 4. 5. 6. 3. AP AP 4. 2 4 4 3 2, 3 4 4, 6 2, 3, 4 4, 6 AP AP AP 7. 5 AP 10. 8. 5 AP 11. 9. 5 C Do It! Review Exercises AP 3. 4 AP 4. Exercises AP AP AP 7. 4, 6 AP 8. 4, 6 AP 9. 4, 6 AP Problems: Set A 5. AP AP 6. 4 4 AP AP 10. 11. 6 6 AP AP 12. 13. 7 8* C AP

5 5 5

AP AP AN 12. 13. 7 8* C AP

7. 8.

4, 5 4, 5, 6 4, 5 4, 5, 6

AP

9.

5, 8*

AP

AN AP AN 9. 5, 8* AP

1. 2.

2, 3, 4, 6 2, 3

3. AP AP 4.

2, 3, 4 4, 6

Problems: Set B 5. 4 AP AP AP 6. 4 AP

7. 8.

*Continuing Cookie Solutions for this chapter are available online.

Copyright © 2011 John Wiley & Sons, Inc.

Kimmel Accounting, 4/e Solutions Manual

(For Instructor Use Only)

5-1

ASSIGNMENT CHARACTERISTICS TABLE

Problem Number 1A 2A 3A 4A 5A 6A Description Journalize, post, prepare partial income statement, and calculate ratios. Journalize purchase and sale transactions...