BU127 Chapter Notes - Chapter 8: Financial Statement, Inventory Turnover
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BU127 Full Course Notes
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Document Summary
Bu127 chapter 8 reporting and interpreting cost of sales and inventory. Lo # 1: apply the cost principle to identify the amount that should be included in inventory and determine the cost of sales for typical retailers, wholesalers and manufacturers. Inventory is tangible property that is either: held for sale in the normal course of business, used to produce goods or services for sale. Merchandisers: companies that do not manufacture the products they sell, but simply purchase those products then sell them to customers. Merchandise inventory: includes goods held for resale in the ordinary course of business. Lo # 2: compare methods for controlling and keeping track of inventory, and analyze the effects of inventory errors on financial statements. Lo # 3: report inventory and cost of sales using three inventory costing methods. Lo # 4: decide when the use of different inventory costing method is beneficial.
