Maker is the writer of a note, promises to pay.

In order to find out the reporting value for inventories on hand, we have to compare cost with market value. E is the right answer.

The correct answer to question is option A. Assets are economic resources a business owns and assets will provide future services or benefits. 

Trade receivables are account and notes receivables from sales transactions.

Accounts receivables is one of them 

A business should report the least favorable figures in the financial statements when
two or more possible options are presented according to the conservatism concept
requirements.

Internal control has five components: control environment, risk assessment, control activities, information and communication, and monitoring activities. The correct answer is B.

Dotted line should be like (A)

Revenue / Expense

COSO framework: • can be applied to all types of business. • has a principle-based approach and this approach can provide flexibility to the internal control process. • states how components and related principles are present and functioning and how components operate together. So, they can understand the requirements for effective controls. • facilitates risk assessment prepares an appropriate response within acceptable level and deals with fraud. • can be applied not only in financial reporting but also all other types of reporting, operating and compliance objectives. • can help to eliminate ineffective, redundant, or inefficient controls.

The perpetual inventory system keeps a running computerized record of merchandise inventory, that is, the number of inventory units and the money amounts associated with the inventory are perpetually (continuously)
updated.
This system achieves better control over the inventory by recording the following information:

• Units purchased and cost amounts
• Units sold and sales and cost amounts
• The quantity of merchandise inventory on hand and its cost.

B is the right answer.

The consistency principle holds that companies should use the same accounting methods and procedures in each accounting period, so that the information provided will help investors and creditors to compare a company’s financial statements from one period to the next. For example, assume that you are analyzing a company’s net income over a two-year period in which there was a decrease in net income from the first year to the second. Analysis of the income statement shows that Sales Revenue was almost the same for both years, but Cost of Goods Sold increased significantly, which resulted in decreases in gross profit and operating income. D is the right answer.

The correct answer to the problem is the operating cycle

First-In, First-Out (FIFO) is an inventory costing method in which the first costs into inventory are the first costs out to cost of goods sold. Ending inventory is based on the costs of the most recent purchases.

Accounts Receivable Turnover Ratio measures the liquidity of accounts receivable and is calculated as net credit sales divided by net accounts receivable. The correct answer is C.

The time-period concept assumes that unlimited economic life of a company will be divided into regular intervals and that financial statements will be prepared for specific periods. The correct answer is D.

The value of inventory for companies selling high-technology or fashion goods might drop very quickly due to changes in technology or fashions. In such cases, inventory is valued at market value other than cost. Two such cases arise when (1) the cost of replacing items in inventory is below the recorded cost and (2) the inventory is not salable at normal sales prices.5

300.000 + 150.000 - 100.000 =350.000 

COGS = Beginning Inventory + Purchases – Ending Inventory

Net Cost of Inventory Purchased = Purchase cost inventory – Purchase returns and allowances – Purchase discounts + Freight in

=140.000-25.000=115.000