Acct chap 5 (end) - Lecture notes 5 PDF

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chapter 5...

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Accounting Chap 5 (after slide 67)  Goods gone bad (return it  Sale made (dr. cash cr. Sales)  When give back (Dr. sales Returns and Allowances  I/s , contra acct , goes right underneath sales Resaleable = dr inventory cr cost of goods If not = don’t get a break on COGs, increases expense account Selling - have to record discount to = sales discounts (contra acct and a contra to the sales account – goes right under sales)

MULTI STEP I/S _________________________________________________________________________________________________ Sales Revenues - Sales - Less: Sales return (Contra, dr balance - Less: Sales Discounts (contra, dr balance) - = NET SALES Operating Expenses - Salaries - Rent - Utiltities - Advertising - Dep’n - Freight out - Loss on Sale of Equipment - = PROFIT FROM OPERATIONS ($ made from running business EBITT – money before Earnings and Taxes) Non operationa; Revs and Expenses - Interest Exp - Interest Rev Profit b4 Tax - Income Tax Expense Profit

EX) -

What did sell was COGS Factor in Ending inventory

JB ex) = want to figure out reduction of inventory and cogs = recognize diff between seeling price of an object and the Cost price of an object = remember to update inventory and __x__ = like sale never even happened “resalable” = dr inv cr cogs Price returned product at is how much you’ve sold it for Updating inventory = price that you paid for it (if not = Overstate inventory and Overstate cogs) Chap 5 MC - B o -

(1000 sale, 150 return = 1 numbers gonna be 850 (if did not take advantage of the discount  so  850 x 0.02 percent = 833

C o Find gross profit margin (sales-COGS=90/400 = 22.5%), eliminate all other answers

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B o...