ACC 250 Study Guide - Fall 2018, Comprehensive Midterm Notes - Accounting, Income Statement, Current Asset
12 Oct 2018
School
Department
Course
Professor
Document Summary
Businesses that buy goods for the purpose of selling them at a profit are dealing in merchandise. The quantity of merchandise on hand is known as merchandise inventory or stock in trade. The type of merchandise included in inventory varies from business to business. For instance, the merchandise inventory of a lumber company consists of various types and sizes of wood products. The merchandise inventory of a good retailer consists of a variety of food commodities. The merchandise inventory of an automobile dealer consists of new and used cars as well as replacement parts. Over the years, accounting for inventory has been done most commonly by the periodic system. It has been the popular choice because it is inexpensive. The periodic inventory system is one in which the cost of the inventory sold is determined only at the end of each fiscal period.
