Solved

Match Each of the Following Definitions with Its Term

Question 217

Matching

Match each of the following definitions with its term.

Premises:
Shipping terms where the ownership of merchandise passes to the buyer when the buyer receives the merchandise.
Shipping terms where the ownership of merchandise passes to the buyer when the seller delivers the merchandise to the freight carrier.
Statement where net income is determined by deducting all expenses from all revenues.
Statement that includes subtotals for net sales, gross profit and net operating income in determining net income.
Inventory system that updates the Merchandise Inventory account only at the end of the accounting period based on a physical count of merchandise on hand.
Inventory system that updates the Merchandise Inventory account for every purchase and sale transaction.
Payment arrangements determined by the seller as to when invoices are due and whether early payment discount is offered.
Losses of inventory due to theft, damage, spoilage, etc. that cause the actual inventory on hand to be less than that on record.
Responses:
FOB Destination
Inventory Shrinkage
Single-Step Income Statement
Credit terms
Perpetual Inventory system
Periodic Inventory system
Multiple-Step Income Statement
FOB Shipping Point

Correct Answer:

Shipping terms where the ownership of merchandise passes to the buyer when the buyer receives the merchandise.
Shipping terms where the ownership of merchandise passes to the buyer when the seller delivers the merchandise to the freight carrier.
Statement where net income is determined by deducting all expenses from all revenues.
Statement that includes subtotals for net sales, gross profit and net operating income in determining net income.
Inventory system that updates the Merchandise Inventory account only at the end of the accounting period based on a physical count of merchandise on hand.
Inventory system that updates the Merchandise Inventory account for every purchase and sale transaction.
Payment arrangements determined by the seller as to when invoices are due and whether early payment discount is offered.
Losses of inventory due to theft, damage, spoilage, etc. that cause the actual inventory on hand to be less than that on record.
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