Answered: The dollar amount paid by a retailer to…

The dollar amount paid by a retailer to acquire a product from a wholesaler is known as the retailer's expenses cost MSRP markup

Principles of Accounting Volume 1

19th Edition

ISBN:9781947172685

Author:OpenStax

Publisher:OpenStax

Chapter6: Merchandising Transactions

Section: Chapter Questions

Problem 1Q: What are some benefits to a retailer for offering a discount to a customer?

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Concept explainers

Bookkeeping

Bookkeeping is the process of recording the financial transactions of a company on a regular basis. With the process of bookkeeping, companies can track important financial information that helps management in making crucial decisions.

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The dollar amount paid by a retailer to acquire a product from a wholesaler is known
as the retailer's
expenses
cost
MSRP
markup

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For a manufacturer, what is the description of the account that is comparable to a merchandising businesss cost of merchandise sold?
Which of the following represents the components of the income statement for a merchandising business? A. Sales Revenue - Cost of Goods Sold = gross profit B. Service Revenue - Operating Expenses = gross profit C. Sales Revenue - Cost of Goods Manufactured = gross profit D. Service Revenue - Cost of Goods Purchased = gross profit
For each of the following statements, fill in the blanks with the correct account names. A. A retailer purchases merchandise on credit. The retailer would recognize this transaction by debiting _____ and crediting _______. B. A retailer pays for purchased merchandise within the discount window. The retailer would recognize this transaction by debiting ________ and crediting _________ and ________. C. A customer returns merchandise to the retailer and receives a full refund. The retailer would recognize this transaction by debiting _________ and crediting _________ if the customer had not yet paid on their account. D. A customer pays for purchased merchandise within the discount window. The retailer would recognize this transaction by debiting ________ and _______, and crediting _________.
What are some benefits to a retailer for offering a discount to a customer?
How does the computation of cost of goods sold for a manufacturer differ from that of a merchandiser?
Conduct research on a real-world retailers trade discounts and policies, and discuss the following questions. Which company did you choose? What do they sell? What is a trade discount? What products are subject to a trade discount? Describe the discount terms/program in detail. Give examples. Are there any restrictions? What incentive does this company have to give a trade discount? How does this discount benefit the buyer? If the buyer had to choose between receiving a trade discount or regular cash purchase discount, which would benefit them more? Why?
A retailer returns $400 worth of inventory to a manufacturer and receives a full refund. What accounts recognize this return before the retailer remits payment to the manufacturer? A. accounts payable, merchandise inventory B. accounts payable, cash C. cash, merchandise inventory D. merchandise inventory, cost of goods sold
The product cost for a merchandising retailer or wholesaler includes: i. all of the costs incurred to manufacture the productsii. shipping costs paid by the company selling goods to the retailer or wholesaleriii. shipping costs paid by the acquiring retailer or wholesaler for inventoryiv. purchase cost of inventory
The revenue account for a merchandising business is typically called ___________. Group of answer choices inventory sales. unearned revenue. fees earned. sales or sales of merchandise.
A retailer pays for purchased merchandise within the discount window. The retailer would recognize this transaction by debiting ["", "", "", ""] and crediting both ["", "", "", ""] and ["", "", "", ""]
Internet companies that simply act as agent or broker for the transfer of goods can record revenue based on: A. the cost of the product sold. B. the fees it charges sellers. C. the sales price of the product.
What is the revenue account for a merchandising business called? Group of answer choices gross profit fees earned net sales sales or sales revenue.