11 terms

Accounting Ch.6

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The largest expense on a retailer's income statement is typically:
Cost of goods sold
Cost of goods sold formula
Net Purchases + beginning inventory - ending inventory.
FOB destination
The seller holds title until the merchandise is received at the buyer's location.
FOB shipping
The seller transfers title to the buyer once the merchandise is shipped.
Gross Profit
Sales-sales return-cost of goods sold
Operating Income
Net sales-cost of goods sold-operating expenses
Gross profit ratio
[Net sales-cost of goods sold]/Net sales
Inventory Turnover ratio
Cost of goods sold/average inventory
Average days in inventory
365/inventory turnover ratio
Gross profit ratio
[Gross profit/net sales]*100
FIFO
The inventory method that will always produce the same amount for cost of goods sold in a periodic inventory system as in a perpetual inventory system