Zebra
___________ goods are products not owned by the party in physical possession of them.
What is Consigned?
Gross sales less sales returns and allowances and sales discounts.
Net sales
This is a source document that provides support for a credit sale.
Sales invoice
An inventory cost flow assumption where a business assumes they sell the first goods they purchased or produced first. This means that the business’s oldest inventory gets shipped out to customers before newer inventory.
What is FIFO?
An account that is offset against a revenue account.
What is Contra revenue account?
"FOB ??????" means the buyer takes ownership and responsibility for the goods (and shipping costs) as soon as they leave the seller's location.
FOB shipping point
A formal document outlining the details of goods or services to be purchased, including quantity, price, and delivery terms, serving as a legally binding agreement.
Purchase Order
Goods that are only partially completed in a manufacturing company.
Work in process
An inventory cost flow assumption. Cost of goods sold consists of the most recent inventory purchases.
What is LIFO?
A % deduction from the total price that is claimed by a buyer for prompt or early payment of a balance due.
What is a discount?
A method of accounting which assumes that the cost of inventory is based on the average cost of the goods available for sale during the period.
Average Cost Method
In accounting, __________ occurs when a retailer has fewer items in stock than were expected by the inventory list. Reasons may be theft, shoplifting or wasted raw materials.
What is shrinkage or shrink?
A classification of inventory a company uses to manufacture its products. Examples include steel, oil, lumber.
A price reduction granted by a seller to a buyer, typically due to a problem with the product or service, such as a defect or incorrect shipment, without requiring the buyer to return the goods
What is sales allowance?
Requires a physical count of goods on hand to compute cost of goods sold.
Periodic inventory system
This ratio measures the number of times the inventory sold during the period.
Inventory turnover ratio
A system used by companies that continuously tracks and updates inventory levels in real-time, recording every transaction (purchase, sale, return) instantly.
What is perpetual inventory system?
Specifies the amount of cash discount and the time period during which it is offered on an invoice.
Credit terms
This inventory system is used when the company only buys or manufacturer's inventory when needed.
What is Just In Time Inventory Management?
FOB ????? means the seller retains ownership and responsibility (and pays for shipping) until the goods reach the buyer's location
FOB Destination
An income statement that is used by merchandisers that includes COGS, Gross Profit, Net Income.
What is the multi-step income statement?
A financial statement that presents a company's financial performance by directly subtracting total expenses from total revenues to calculate net income
What is the single step income statement?
A contra revenue account that represents the returns by customers and price allowances granted to customers.
What is sales returns and allowances?
An inventory costing system where the price paid for an item is specifically identified with the item and expensed when the item is sold.
What is specific identification method?