Question 8. Question : (TCOs A and B) A periodic inventory system would most likely be used by a(n) Question 9. Question : (TCOs A and B) LBJ Company recorded the following events involving a recent merchandise purchase. Question 10. Question : (TCO A) In a period of increasing prices, which of the following inventory methods generally results in the highest gross profit? Question 11. Question : (TCO D) A classmate is considering dropping his or her accounting class because he or she cannot understand the rules of debits and credits. Explain the rules of debits and credits in a way that will help him or her understand them. Cite examples for each of the major sections of the balance sheet (assets, liabilities and stockholders' equity) and the income statement (revenues and expenses). Question 12. Question : (TCOs B and E) The Caltor Company gathered the following condensed data for the Year Ended December 31, 2010. Cost of goods sold $ 710,000 Net sales 1,279,000 Administrative expenses 239,000 Interest expense 68,000 Dividends paid 38,000 Selling expenses 45,000 Instructions: 1: Prepare a multiple-step income statement for the year ended December 31, 2010.