Discussion Post
We will be reviewing Chapter 5 on Merchandising Operations. Companies like Wal-Mart, Target, and Amazon are all examples of companies that purchase inventory from suppliers, and then sell those products to consumers.
• Describe the 2 formats for the income statement of a merchandising company, and list the respective sub-totals found in each income statement format. (You should describe some of the accounts found on each type of income statement).
• o Describe purchase discounts and purchase returns & allowances.
o Describe the 2 shipping terms methods companies use when delivering products, and how freight costs are accounted for.
• Sales on Account - Many sales are made on account (on credit) instead of with cash or a credit card. Assume that your new company purchases products for resell to customers, and your plan is to sell those products at a profit. Make the appropriate journal entries to record the sale (on account - ie., on credit) assuming your company sells 4 of those products to a single customer.
The response should include a reference list. One-inch margins, Using Times New Roman 12 pnt font, double-space and APA style of writing and citations.