Accounting for Merchandising Business

It is a type of business that involves buying and selling of goods

• Merchandising Business

• Service Business

• Manufacturing

It is the product or good that you are selling

• Supplies

• Cash

• Inventory

• Prepaid Expense

It is a discount that is not recorded in the books of seller or buyer

• Cash Discount

• Trade Discount

This type of merchandiser buys inventory in bulk

• Wholesaler

• Retailer

Under periodic system, purchase of goods is recorded under the account title of

• Merchandise Inventory

• Sales

• Purchases

• Purchase Discount

It is used by businesses selling goods with different low-priced items

• Perpetual System

• Periodic System

It is used by businesses selling high-priced items

• Perpetual System

• Periodic System

It is the cost of transporting the goods shouldered by the buyer

• Freight out

• Delivery Expense

• Purchases

• Freight In

It is the discount that you gave to the buyer of your product

• Purchase Discount

• Sales Discount

• Purchase Returns and Allowances

• Sales Returns and Allowances

It is the original cost of the product you have sold

• Purchases

• Merchandise Inventory

• Cost of Goods Sold

• Sales