Chapter 3 vocab Flashcards
whats a merchandising business
buys and resellls merchandise bought from suppliers
merchandise inventory
supply of goods for resale
product costs
any costs related to producing or manufacturing.
ex. labor, manufacturing overhead,
what are selling and admin costs
advertising, admin salaries, Insurance interest
Period costs
Sales, advertising, exec, ceo salaries, office insurance
cost of inventory formula
Beg INV bal + Purchased INV= COG available
Cost of goods available,
total cost to obtain inventory
cost of goods sold
total cost incurred for goods sold
what statement is merchandise inventory go on
Balance sheet (asset)
What statement does cost of goods sold go on
Income statement (expense)
Gross Margin
difference betwen sales revenue and costs of goods sold
perpetual inventory system
Increase inventory count when goods are purchased decreases when merch is sold
Purchase return
DECREASES assets DECREASES liabilities
Purchase allowances
A reduction in cost of purchases
Cash discounts
discount of merchandise to encourage payment
