ACCT 202 Chapter Notes - Chapter 4: List Of Auto Parts, Net Income, Sports Equipment
Document Summary
Example: sporting goods, clothing, and auto parts stores. Net sales - cogs = gross profit - expenses = net income. Begins with the purchase of merchandise and ends with the collection of cash from the sale of merchandise. Purchases > merchandise inventory > cash sales > Purchases > merchandise inventory > credit sales > accounts receivable > cash collections > Beginning inventory + net purchases = merchandise available for sale = ending. Used by manufactured and wholesalers to offer better prices for greater quantities purchased. A deduction from the invoice price granted to induce early payment of them amount due due. Discount percent/ # of days discount is available, otherwise, net (or all) is due in 30 days/ credit period. Refer to merchandise a buyer acquired but then returns to the seller. Is a reduction in the cost of defective of unacceptable merchandise that a buyer aqqures.
