Flashcards
Vocabulary
Cards in this deck (11)
- 1Wholesaler:a company that sells to other businesses
- 2Retailer:companies that sell goods to the final consumer
- 3Cost of goods sold:an expense account; the cost of items sold is expensed on income statement
- 4Inventorygoods purchased for resale
- 5Gross profit:the difference between the sales revenue and the cost of goods sold
- 6Gross margin:difference between the sales revenue and the cost of goods sold
- 7Purchase discount:a purchase discount reduces the cost of the inventory and the associated account payable on the balance sheet.
- 8Sales discount:price reductions offered by sellers to encourage buyers to pay promptly
- 9FOB shipping pointthe buyer is responsible for the transportation cost. AKA: transportation-in
- 10FOB destinationthe seller is responsible for the freight cost. AKA: transportation-out
- 11Internal controls for taking inventory(1) assign the task of recording inventory transactions to different employees from those responsible for counting inventory.
(2) increases and decreases in inventory are recorded at the time inventory is purchased and sold.
(3) Gross margin method used to estimate the ending inventory balance.
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- Accounting (Exam 2 vocabulary) Flashcards on Vocabulary, created by Jaina Linsley on 07/10/2013.
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- Jaina Linsley
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