Higher Accounting - Income Statement Terminology

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Money the business receives from customers from selling their goods and services

• Gross profit

• Sales revenue

• Sales returns

• Warehouse expenses

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Total value of goods returned to the business for customers (e.g. because the goods sold were faulty)

• Sales returns

• Purchase returns

• Carriage in

• Warehouse expenses

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The figure that arises from deducting sales returns from sales revenue (i.e. sales revenue - sales returns = ?)

• Opening inventory

• Net sales

• Cost of sales

• Gross profit

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Inventory carried forward from the previous accounting period

• Opening Inventory

• Purchases

• Closing Inventory

• Carriage In

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Total value of inventory purchased from suppliers by the business for resale

• Purchases

• Closing Inventory

• Other Income

• Expenses

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A charge added to purchases when the supplier delivers inventory to the business's premises. It is sometimes referred to as a delivery charge

• Carriage in

• Carriage way

• Carriage out

• Carriage car

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Total value of inventory returned to suppliers by the business, (e.g. when the wrong goods are delivered by the supplier or a greater quantity than ordered is delivered)

• Carriage in

• Purchase returns

• Sales returns

• Carriage out

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Inventory unsold at the end of an accounting period. This will also appear as a current asset in the Statement of Financial Position.

• Closing inventory

• Opening inventory

• Purchases

• Carriage out

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The costs incurred in storing inventory in a warehouse prior to sale

• Warehouse costs

• Warehouse expenses

• Warehouse revenue

• Warehouse application

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The result of subtracting cost of sales from the net sales revenue

• Gross profit

• Profit for the year

• Net sales

• Expenses