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Chapter 32 – Solutions

Multiple Choice Solutions​

  1. d) Food sales are subject to 3% VAT (reduced rate).

  2. c) Alcoholic beverages are subject to 17% VAT (standard rate).

  3. b) Cash tips given directly to staff are not business revenue.

  4. b) FIFO is particularly important for perishable inventory.

  5. b) Luxembourg uses VAT (Value Added Tax).

  6. c) For EU B2C e-commerce sales, VAT is consumer's country VAT.

  7. b) Digital goods sold B2C are subject to consumer's country VAT.

  8. c) Job costing tracks costs by individual job/order.

  9. b) Advance payments are recorded as unearned revenue (liability).

  10. c) Project accounting helps track both revenue and costs by project.

Note: Complete solutions for Problems Set A, Set B, and Comprehensive Problem are available in the instructor solutions manual.

End of Chapter 32 Solutions