中山大学会计基础lesson06en学习课件.pptVIP

Lesson 6 Accounting for Merchandising Activities Task Team of FUNDAMENTAL ACCOUNTING School of Business, Sun Yat-sen University Outline Merchandising activities Operating cycle of merchandising companies Merchandising cost accounts Inventory systems Merchandise purchases Sales transactions Adjusting and closing entries Introduction Scandals in stock market occur now and then. Among them, financial frauds or income manipulation are common. Income manipulation typically starts from making up sales revenues as well as purchases, for example, GuangXia (Yinchuan). In this lesson you are required to think about, Why these income statement numbers are so important? How they are recorded in accounting system? Merchandising Activities Reporting Financial Performance Reporting Financial Performance Operating Cycle of Merchandise Companies Merchandising Cost Accounts Inventory Systems Periodic MethodRequires updating the inventory account only at the end of the period. Acquisition of merchandise inventory is recorded in a temporary Purchases account. Inventory Systems Perpetual provides a continuous record of: The amount of inventory on hand. Cost of goods sold to date. Periodic requires a physical count of goods to determine: The amount of inventory on hand. Cost of goods sold. Comparison of Perpetual and Periodic Systems Comparison of Periodic and Perpetual Systems Comparison of Periodic and Perpetual Systems Trade Discounts Purchase discount is a deduction from the invoice price granted to induce early payment of the amount due. Example – 2/10, n30 Purchase Discounts Assume the purchase of $4,000 inventory on October 1 was on the terms 2/10,n30. Managing Discounts Purchase Returns and Allowances Purchase Return . . . Merchandise returned by the purchaser to the supplier. Purchase Allowance . . . A reduction in the cost of defective merchandise received by a purchaser from a supplier. Purchase Returns and Allowances On Nov. 1, Helo Inc. purchased $10,000 of Merchan