Merchandising

MERCHANDISING
  * Discounts
      a) Cash Discounts
-prompt payment
-recorded
      b) Trade Discounts
-deducted to list price to get invoice price
-bulk orders
-not recorded
  * Transportation Cost
  a) FOB Destination, Freight Prepaid
-si seller ang dapat magbayad kaya siya ang nagbayad
ENTRIES:
            Buyer |                 Seller |
Purchases     Accounts Payable | Accounts Receivable     Sales |
No Entry | Freight-Out     Cash |

  b) FOB Destination, Freight Collect
-si seller ang dapat magbayad pero si buyer muna ang nagbayad
ENTRIES:
            Buyer |                 Seller |
Purchases     Accounts Payable | Accounts Receivable     Sales |
Accounts Payable     Cash | Freight-Out     Accounts Receivable |

  c) FOB Shipping Point, Freight Collect
-si buyer ang dapat magbayad kaya siya ang nagbayad
ENTRIES:
            Buyer |                 Seller |
Purchases     Accounts Payable | Accounts Receivable     Sales |
Freight-in     Cash | No Entry |

  d) FOB Shipping Point, Freight Prepaid
-si seller ang dapat magbayad pero si seller ang nagbayad
ENTRIES:
            Buyer |                 Seller |
Purchases     Accounts Payable | Accounts Receivable     Sales |
Freight-in     Accounts Payable | Accounts Receivable     Cash |

  * Invetory Systems
  a) Perpetual Inventory System
-the inventory account is continuously updated.
-high-priced, low- volume goods
  b) Periodic Inventory System
-the inventory account is not continuously updated.
-inexpensive goods

MAIN FORMULA IN MERCHANDISING:
Net Sales
-Cost of Sales/Cost of Goods Sold
Gross Profit
-Expenses                                      
Net Profit/Net Loss

  * Net Sales
Gross Sales
-Sales Discount
-Sales Returns & Allowances                                
Net Sales
                    Periodic |                     Perpetual |
Cash/Accounts Payable     Sales | Cash/Accounts Receivable     SalesCost of Sales... [continues]

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