Reading...
Play button
Play button
Use LEFT and RIGHT arrow keys to navigate between flashcards;
Use UP and DOWN arrow keys to flip the card;
H to show hint;
A reads text to speech;
28 Cards in this Set
- Front
- Back
|
The cost that is reported as an expense when merchandise is sold.
|
Cost of merchandise sold
|
|
|
Sales minus the cost of merchandise sold.
|
Gross profit
|
|
|
Merchandise on hand(not sold) at the end of an accounting period.
|
Merchandise Inventory
|
|
|
The inventory system in which each purchase and sale of merchandise is recorded in an inventory account.
|
Perpetual inventory system
|
|
|
The inventory system in which the inventory records do not show the amount available for sale or sold during the period.
|
Periodic inventory system
|
|
|
A detailed listing of the merchandise for sale at the end of an accounting period.
|
Physical Inventory
|
|
|
The bill that the seller sends to the buyer.
|
Invoice
|
|
|
Discounts taken by the buyer for early payment of an invoice.
|
Purchases discounts
|
|
|
From the buyer's perspective, returned merchandise or an adjustment for defective merchandise.
|
Purchases return or allowance
|
|
|
A form used by a buyer to inform the seller of the amount the buyer proposes to debit to the account payable due to the seller.
|
Debit memorandum
|
|
|
From the seller's perspective, discounts that a seller may offer the buyer for early payment.
|
Sales Discounts
|
|
|
From the seller's perspective, returned merchandise or an adjustment for defective merchandise.
|
Sales return or allowance
|
|
|
A form used by the seller to inform the buyer of the amount the seller proposes to credit to the account receivable due from the buyer.
|
Credit memorandum
|
|
|
Discounts from the list prices in published catalogs or special discounts offered to certain classes of buyers.
|
Trade discounts
|
|
|
Freight terms in which the buyer pays the transportation costs from the shipping point to the final destination.
|
FOB shipping point
|
|
|
Freight terms in which the seller pays the transportation costs from the shipping point to the final destination.
|
FOB destination
|
|
|
A form of income statement that contains several sections, subsections, and subtotals.
|
Multiple-step income statement
|
|
|
Expenses that are incurred directly in the selling of merchandise.
|
Selling expenses
|
|
|
Expenses incurred in the administration or general operations of the business.
|
Administrative expenses
|
|
|
The excess of gross profit over total operating expenses.
|
Income from operations
|
|
|
The excess of operating expenses over gross profit.
|
Loss from operations
|
|
|
Revenue from sources other than the primary operating activity of a business.
|
Other income
|
|
|
Expenses that cannot be traced directly to operations.
|
Other expense
|
|
|
A form of income statement in which the total of all expenses is deducted from the total of all revenues.
|
Single-step income statement
|
|
|
The amount by which the merchandise for sale, as indicated by the balance of the merchandise inventory account, is larger than the total amount of merchandise counted during the physical inventory.
|
Inventory shrinkage
|
|
|
The form of balance sheet in which assets are reported on the left-hand side and the liabilities and owner's equity on the right-hand side.
|
Account form
|
|
|
The form of balance sheet in which assets, liabilities, and owner's equity are reported in a downward sequence.
|
Report form
|
|
|
Measures how effectively a business is using its assets to generate sales.
|
Ratio of net sales to assets
|
