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What are the four steps involved in the closing process for a merchandising company?

Principles of Accounting Volume 1

19th Edition

ISBN:9781947172685

Author:OpenStax

Publisher:OpenStax

Chapter10: Inventory

Section: Chapter Questions

Problem 2Q: Can a business change from one inventory costing method to another any time they wish? Explain.

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What is the third entry of the closing procedure for a merchandising business? a. Sales to Income Summary b. Income Summary to Capital c. Expenses to Income Summary d. Drawing to Capital e. Capital to Income Summary
Name the three inventory accounts for a manufacturing business, and describe what each balance represents at the end of an accounting period.
A merchandising company's closure procedure includes four phases.
Match each of the following types of companies with its definition. Types of Companies Definitions 1. Service company 2. Merchandising company 3. Manufacturing company a. Purchases goods that are primarily in finished formfor resale to customers.b. Records revenues when providing services tocustomers.c. Produces the goods they sell to customers.
(a) How are the components of revenues and expenses different for a merchandising company? (b) Explain the income measurement process of a merchandising company.
What are the key differences in performing adjusting and closing for a service company, versus a merchandising company?
Describe a merchandising company's operational cycle.
What is the revenue account for a merchandising business called? Group of answer choices gross profit fees earned net sales sales or sales revenue.
Office salaries, depreciation expense on office equipment, and office supplies expense are examples of what type of expenses for a merchandising business? Group of answer choices administrative expenses selling expenses miscellaneous expenses other expenses
In the income statement of a manufacturing company, what replaces purchases in the cost of goods section of a retail company? Cost of goods manufactured Work in process completed Cost of merchandise available for sale Finished goods
Describe merchandising activities and identify income components for a merchandising company
Understand the components of a merchandising company’s income statement.