WorksheetsAccounting for Merchandising Businesses
Total questions: 13
Worksheet time: 25mins
A type of business that involves buying and selling of goods.
Merchandising
Service
Manufacturing
It is the product or good being sold.
Supplies
Cash
Inventory
Prepaid Expense
The original cost of the product sold.
Purchases
Merchandise Inventory
Cost of Goods Sold
Sales
Gross profit equals the difference between net sales and
cost of sales plus operating expenses
cost of good sold
operating expenses
profit
Result when expenses are LESS THAN the total revenue for a time period.
Net income
Net loss
Gain on sale
Loss on sale
If gross profit is $55,000 and cost of goods is $125,000, how much are total net sales?
(a)
It is a major expense of the merchandising business. It is the cost of the merchandise that the company sold to its customers.
Merchandise inventory
Cost of Goods Sold
Freight in
Sales Discounts
Obtained by deducting the cost of goods sold from the net sales.
Net Income
Gross Profit
Earnings Before Tax
Operating Income
These are ordinary and necessary expenses in the day-to-day running of the operations of the business. Examples include utilities, salaries, rent, etc.
Cost of Sales
Cost of Goods Sold
Operating Expenses
Purchases
If a retailer buys goods costing $2,000 and later sells them at a 25% markup, what is the selling price?
2,500
2,250
2,300
2,525
The basic differences between the financial statement of a merchandising business and a service business include (1) the cost of goods sold section in the income statement and (2) ?
Computation of profit
Other income section in income statement
Equity section in balance sheet
Inclusion of merchandise inventory as an asset account in the balance sheet
The difference between sales and cost of goods sold for a merchandising business.
Sales
Net sales
Net profit
Gross profit
_____ is reported as a current asset on the balance sheet.
Operating income
Cost of goods sold
Merchandise inventory
Accounts payable
