Accountıng I Deneme Sınavı Sorusu #1190930
What happens if the merchandise inventory is sold?
Gross profit is calculated. Gross profit evaluates the company’s profitability in terms of selling activities. |
Multiple-step income statement is preferred. |
Cost is taken from inventory account in balance sheet and recognized as an expense (cost of goods sold) in the income statement. |
Companies use “Purchase” account to record their purchases of inventories. |
Freight cost is not included in the cost of goods. |
Yanıt Açıklaması:
If the merchandise inventory is sold, its cost is taken from inventory account in balance sheet and recognized as an expense (cost of goods sold) in the income statement.
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