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Accounting 210
Chapter 6&7
| Term | Definition |
|---|---|
| purchase order | authorizes the purchase of the inventory from an approved vendor |
| physical inventory | a detailed list of merchandise on hand |
| gross profit | sales minus the cost of merchandise sold |
| inventory turnover | the relationship between the volume of goods sold and inventory, computed by dividing the cost of good sold by the average inventory |
| consigned inventory | merchandise that is shipped by manufactures to retailers who act as the manufacture's selling agent |
| consignor | the name for the manufacturer in a consigned inventory arrangement |
| receiving report | the form or electronic transmission used by the receiving personnel to indicate that materials have been received and inspected |
| retail inventory method | a method of estimating inventory cost that is based on the relationship of gross profit to sales |
| consignee | the name for the retailer in a consigned inventory arrangement |
| credit terms | terms for payment on account by the buy to the seller |
| credit period | the amount of the time the buyer is allowed in which to pay the seller |
| account form | the form of balance sheet that resembles the basic format of the accounting equation with assets on the left side and liabilities and owner's equity sections on the right side |
| sales | the total amount charged customers for merchandise sold, including cash sales and sale on account |
| report form | the form of balance sheet with the liabilities and owner's equity sections presented below the assets section |
| invoice | the bill that the seller sends to the buyer |
| merchandise inventory | merchandise on hand(not sold) at the end of an accounting period |
| net sales | revenue received for merchandise sold to customers less any sales returns and allowances and sales discounts |
| other expense | expenses that cannot be traced directly to operations |
| other income | revenue from sources other than the primary operating activity of a bisiness |
| sales discounts | from the seller;s perspective, discounts that sellers may offer the buyer for early payment |
Created by:
gaston.gonzalez
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