Merchandising

Question 1

What is Terms of Sale

Answer 1

Amount of time you have to pay for invoice

Question 2

What is C.O.D

Answer 2

Payment must be made when goods are delivered

Question 3

What is Receipt of Invoice

Answer 3

Payment is made when the invoice is received

Question 4

What is Net 30

Answer 4

Full amount of invoice is due 30 days after invoice was delivered

Question 5

What is EOM

Answer 5

Payment due by the end of the month

Question 6

10th Following

Answer 6

Payment is due by the 10th day of the following month

Question 7

What is 2/10, n/30

Answer 7

Get 2% discount if you pay within 10 days, but invoice is due in 30 days

Question 8

What is 1/10, n/30, EOM

Answer 8

Get 1% discount if you pay within 10 days, but payment is due 30 days at the end of the month

Question 9

What is a Merchandising Business

Answer 9

Buys goods and resells them at a higher price

Question 10

What is a Manufacturing Business

Answer 10

Buy raw materials and converts them to a new product

Question 11

What is Merchandise

Answer 11

Goods bought for resale

Question 12

What is Merchandise Inventory

Answer 12

Accounts represent the total dollar value of goods on hand for sale (Current Asset if goods are in stock)

Question 13

What is Periodic Inventory Method

Answer 13

Inventory is updated after the end of period

Question 14

What is Physical Inventory

Answer 14

A count of all goods in hand

Question 15

What is Perpetual Inventory Method

Answer 15

Continuously records change in merchandise on hand

Updates journal after item is purchased, sold, or returned

Question 16

What is the formula for gross profit

Answer 16

GP = Revenue - COGS

Question 17

What is COGS

Answer 17

Cost of Goods Sold; a record of all costs related to merchandise being sold

Question 18

What is formula for net profit

Answer 18

NP = GP - Expenses

Question 19

What is a schedule (in finance)

Answer 19

A supporting statement that provides details of an item on a main statement

Question 20

What is the formula for COGS

Answer 20

COGS = Beginning Inventory + Purchases

COGS = CGAS - Ending Inventory

Question 21

What is CGAS

Answer 21

Cost of Goods Available for Sale

Question 22

What are purchases

Answer 22

Cost of Merchandise purchased for resale (expense account)

Question 23

What are purchases returns & allowance (PRA)

Answer 23

Records goods purchased, then returned (contra expense account)

Question 24

What are purchase discounts

Answer 24

When things get paid early, they usually offer discounts

Question 25

What is Net Purchases Formula

Answer 25

NP = P - PRA - PD

Question 26

What is Transportation-in

Answer 26

The cost for transporting stuff from stuff purchased (expense account)

Question 27

How to prepare schedule for COGS

Answer 27

Beginning Inventory + Net Profit + Transportation In - Ending Inventory = COGS

Question 28

What are sales

Answer 28

Amount of goods sold for cash or on credit to customers in accounting period

Question 29

What are sales return and allowances

Answer 29

Record merchandise returned by customers

Question 30

What are Sales Discounts

Answer 30

Offered to encourage early cash payment of customer balances

Question 31

What is B2B

Answer 31

Business to business transactions

Question 32

What is base Amount

Answer 32

Pretax value of product

Question 33

What is the formula for Net Purchase

Answer 33

NP = Purchases - Returns - Discount

Question 34

What is the formula for Net Sales

Answer 34

NS = Purchases - Returns - Sale Discount

Question 35

What is Delivery Expense

Answer 35

Expenses that occur when delivering to customer