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16 Cards in this Set
- Front
- Back
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Contra-revenue account
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A debit balance account that is offset against revenue in the income statement. Examples include: Sales Discounts & Sales returns & Allowances
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Control Account
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A general ledger account that summarizes the content of a specific subsidiary ledger.
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Cost of goods sold
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The cost to a merchandising company of the goods it has sold to its customers during the period.
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Gross profit
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Net sales revenue minus the costs of goods sold.
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Gross profit margin
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Gross profit expressed as a percentage of net sales.
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Inventory
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Merchandise intended for resale to customers.
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Inventory shrinkage
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The loss of merchandise through such causes as shoplifting, breakage, and spoilage.
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Net Sales
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Gross sales revenue - sales returns & allowances & discounts. The most widely used measure of dollar sales volume; usually the first figure shown in an income statement.
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Operating cycle
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The repeating sequence of transactions by which a business generates its revenue and cash receipts from customers.
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Periodic inventory system
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It eliminates the need for recording the cost of goods sold as sales occur. However, the amounts of inventory and the cost of goods sold are not known until a complete physical inventory is taken at year-end.
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Perpetual inventory system
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A system of accounting for merchandising transactions in which the Inventory and COGS accounts are kept perpetually up-to-date.
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Point-of-sale (POS) terminals
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Electronic cash registers used for computer-based processing of sales transactions. They identify each item of merchandise from bar codes and then automatically records the sales and updates the computer-based inventory records.
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Sales per square foot of selling space
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A measure of efficient use of available space.
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Special journal
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An accounting record or device designed for recording large numbers of a particular type of transaction quickly and efficiently.
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Subsidiary ledger
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A ledger containing separate accounts for each of the items making up the balance of a control account in the general ledger. The total of the account balances are equal to the balance in the control account.
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Taking a physical inventory
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the procedure of counting all merchandise on hand & determining its cost.
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