Kế toán, kiểm toán - Merchandising business

Merchandising BusinessMerchandising Income StatementNet SalesCost of Goods SoldGross MarginOperating ExpensesNet Operating MarginMerchandising Income StatementOther Revenues and ExpensesNet Income before TaxesIncome Tax ExpenseNet IncomeNet SalesSalesTotal or gross sales of merchandiseTrade discountsPercentage reduction from list priceSales returns and allowancesReduction of price after saleReturn of unacceptable merchandiseNet SalesSales DiscountsDiscount for payment within a stated period2/10, n/302% discount if paid within 10 daysGross amount due in 30 daysNet SalesGross sales revenueDeduct: Sales returns and allowances Sales discountsNet sales revenuesMerchandise Inventory SystemsPeriodic inventory systemDetermine cost of goods sold and inventory balance only at end of each accounting periodPerpetual inventory systemDetermine cost of goods sold and inventory balance after each sale.Cost of Goods Sold: PeriodicMerchandise inventory, beginningPurchasesTransportation in Gross delivered cost of purchasesDeduct: Purchases returns and allowances Purchases discountsNet cost of purchasesCost of goods available for saleDeduct: Merchandise inventory, ending Cost of goods soldPurchasesRecords the cost of all merchandise bought for resaleRecorded at invoice costTransportation InFOB shipping pointBuyer is owner during transit and is responsible for transportation costsFOB destinationSeller is owner during transit and is responsible for transportation costsPurchases Returns and AllowancesContra account to purchasesRecordsPrice concessions after purchaseReturns of merchandisePurchases DiscountsContra account to purchasesRecordsCash discounts allowed for payments within discount periodNet Cost of PurchasesPurchasesTransportation in Gross delivered cost of purchasesDeduct: Purchases returns and allow Purchases discountsNet cost of purchasesMerchandise InventoryCost of merchandise on handAmount determined byPhysical count of units on handPricing at respective costsCost of Goods Sold: PeriodicMerchandise inventory, beginningPurchasesTransportation in Gross delivered cost of purchasesDeduct: Purchases returns and allowances Purchases discountsNet cost of purchasesCost of goods available for saleDeduct: Merchandise inventory, ending Cost of goods soldGross Margin on SalesDifference between net sales and cost of goods soldGross means must still deduct expensesOperating ExpensesSelling expensesExpenses incurred in advertising, selling, and deliveringGeneral and administrative expensesOther operating expenses such as office expenses, computer services, and executive salariesNet Operating MarginGross marginLess operating expensesOther Revenue and ExpensesRevenues and expenses that do not relate to the principal activity of the businessSeparation permits calculation of net operating margin without influence of these nonoperating itemsIncome Tax ExpenseCorporations must pay taxes on incomeCalculation prescribed by federal and state lawsNet Price MethodPurchases discounts lost methodRecord the purchase at invoice price less cash discountIf paid after discount period lapses, extra cost recorded as Purchases Discount LostAnalyzing InformationAre net sales increasing or decreasing?What is percentage change in net sales?Is percentage of cost of goods sold to net sales increasing or decreasing?Analyzing InformationIs gross margin percent increasing or decreasing?Is percentage of operating expenses to net sales increasing or decreasing?Is gross margin percent increasing or decreasing?