Introduction to inventories, Accounting Basics

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Q. Introduction to inventories?

Subsequent to studying this chapter you should be able to

- Record the journal entries for sales transactions involving merchandise.

- Explain briefly cost of goods sold and the distinction between perpetual and periodic inventory procedures.

- Record the journal entries for purchase transactions involving merchandise.

- Explain the freight terms and record transportation costs.

- Conclude cost of goods sold.

- Prepare a categorize income statement.

- Analyze and use the financial results-gross margin percentage.

- Prepare a work sheet as well as closing entries for a merchandising company.


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