财务会计入门英文版PPT1.pptx

Accounting for Merchandising OperationsLearning ObjectivesDescribe the nature and types of inventory and how profit is measured in a merchandising business.Distinguish between perpetual and periodic inventory systems.Explain the recording of purchases under a perpetual inventory system.Explain the recording of sales revenues under a perpetual inventory system.Prepare a fully classified Statement of Comprehensive Income.Be able to define, calculate, and analyze certain profitability ratios.Understand the basic process and main features of the goods and services tax (GST).Complete journal entries to record GST.LO 1: Inventory DefinedInventories are current assets heldFor sale in the ordinary course of business;In the process of production for such sale; orIn the form of materials or supplies to be consumed in the production process.LO 1: Merchandising OperationsMerchandising CompaniesBuy and Sell Goods WholesalerRetailerConsumerThe primary source of revenues is referred to assales revenue or sales.LO 1: Merchandising OperationsProfit MeasurementNot used in a Service business.SalesRevenueLessCost of Goods SoldGross Profit=LessOperating ProfitOperating Expenses=Cost of goods sold is the total cost of merchandise sold during the period.LO 1: Merchandising OperationsOperating CycleThe operating cycle of a merchandising company ordinarily is longer than that of a service company.LO 1: Merchandising OperationsFlow of CostsLO 2: Inventory Systems--Perpetual SystemWidespread use due to technological feasibility.Most prominent characteristic: “Merchandise Inventory” and “Cost of Goods Sold” accounts are perpetually updated as transactions occur.Are periodic inventory counts still required? Periodic systemUse… Most prominent characteristic: “Merchandise Inventory” account and Cost of Goods Sold are updated at the end of the accounting period, after inventory is counted and costed. LO 3: Buyer’s Records—E5-2, page 232 (adapted)1. On 5 April purchased merchandise from R