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Ch. 4 - Merchandising OperationsWorksheetSee all chapters
All Chapters
Ch. 1 - Introduction to Accounting
Ch. 2 - Transaction Analysis
Ch. 3 - Accrual Accounting Concepts
Ch. 4 - Merchandising Operations
Ch. 5 - Inventory
Ch. 6 - Internal Controls and Reporting Cash
Ch. 7 - Receivables and Investments
Ch. 8 - Long Lived Assets
Ch. 9 - Current Liabilities
Ch. 10 - Time Value of Money
Ch. 11 - Long Term Liabilities
Ch. 12 - Stockholders' Equity
Ch. 13 - Statement of Cash Flows
Ch. 14 - Financial Statement Analysis
Ch. 15 - GAAP vs IFRS
Sections
Service Company vs. Merchandising Company
Net Sales
Cost of Goods Sold - Perpetual Inventory vs. Periodic Inventory
Perpetual Inventory - Purchases
Perpetual Inventory - Freight Costs
Perpetual Inventory - Purchase Discounts
Perpetual Inventory - Purchasing Summary
Periodic Inventory - Purchases
Periodic Inventory - Freight Costs
Periodic Inventory - Purchase Discounts
Periodic Inventory - Purchasing Summary
Single-step Income Statement
Multi-step Income Statement
Comprehensive Income
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Next SectionPeriodic Inventory - Purchase Discounts
As with other purchasing activities, any delivery costs paid by our company to receive our Inventory is kept in an account separate from our main Inventory account (Freight In). These costs eventually increase the value of our Inventory.

Concept #1: Periodic Inventory: Freight Costs (FOB Shipping Point)

Concept #2: Periodic Inventory: Freight Costs (FOB Destination)

Previous SectionPeriodic Inventory - Purchases
Next SectionPeriodic Inventory - Purchase Discounts