Merchandising Operations Horngren’s Accounting Lecture Twelve Lisa, Li 1

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1. Merchandising Operations Horngren’s Accounting Lecture Twelve Lisa, Li 1
2. Merchandising Operations- Objective 1Accounting
3. accounting Learning Objectives 2Purchase of merchandise inventory using perpetual inventory system
4. accounting Learning Objectives 3 Account
5. Homework
6. Homework
7. Homework
8. Homework
9. Learning Objectives –
10. Learning Objectives –
11. accounting Learning Objectives 3 Account
12. 4. Transportation Cost - Freight OutThe freight
13. 5. Net Sales RevenueFor the year, Smart
14. 5. Net Sales RevenueFor the year, Smart
15. 6. Gross ProfitThe difference between Net Sales
16. Practice Questions
17. Practice Question Solutionsaccounting
18. Learning Objectives 4 Adjust and close the accounts of a merchandising businessAccounting
19. Adjusting Merchandise InventoryAt the end of
20. Adjusting Merchandise InventorySmart Touch Learning’s Merchandise
21. Closing the Accounts of a MerchandiserClose R
22. 5-accounting Closing in a Merchandiser
23. Closing the Accounts of a MerchandiserAt this
24. Learning Objectives 5 Prepare a merchandiser’s financial statementsAccounting
25. Merchandiser’s Financial StatementsIncome StatementSingle-Step Income StatementMulti-Step Income
26. Single-Step Income StatementIncome statement format that groups
27. Multi-Step Income StatementMulti-step I/S format that
28. Multi-Step Income StatementCOGS: is also called
29. Operating Expenses: Expenses (other than COGS) that
30. Other revenues and expenses: Revenues or expenses
31. Statement of Owner’s Equity and the B/SA
32. Learning Objectives 6 Use the gross profit percentage to evaluate business performanceAccounting
33. Gross Profit PercentageMeasures the profitability of each
34. Gross Profit Percentage—Example
35. Gross Profit Percentage—Example
36. Gross Profit Percentage—Example
37. Gross Profit Percentage—Example
38. Practice Question accounting
39. Practice Question accounting a. Sales
40. Example – Summary Problem 5-1Accounting
41. Accounting
42. Summary Problem 5-1Accounting
43. 5-The adjusted trial balance of Leading Business Systems at March 31, 2015, follows:Homework
44. The End of Chapter 5
45. Скачать презентанцию

Merchandising Operations- Objective 1Accounting

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Merchandising Operations Horngren’s Accounting Lecture Twelve Lisa, Li 1

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Слайд 1Merchandising Operations
Horngren’s Accounting

Lecture Twelve
Lisa, Li

Слайд 2Merchandising Operations- Objective 1
Accounting

Слайд 3accounting
Learning Objectives 2
Purchase of merchandise inventory using perpetual inventory

system

Слайд 4accounting
Learning Objectives 3
Account for the sale

of merchandise inventory using a perpetual inventory system

accounting Learning Objectives 3 Account for the sale of merchandise inventory using a perpetual inventory

Слайд 8 Homework

p342

accounting

Accounting book for The Textbook Store

Accounting book for Piranha(seller)

Слайд 9Learning Objectives – Chapter 5
Describe merchandising operations

and the two types of merchandise inventory systems
Account for the

purchase of merchandise inventory using a perpetual inventory system
Account for the sale of merchandise inventory using a perpetual inventory system

Accounting

Learning Objectives – Chapter 5 Describe merchandising operations and the two types of

Слайд 10Learning Objectives – Chapter 5
Adjust and close

the accounts of a merchandising business
Prepare a merchandiser’s financial statements
Use

the gross profit percentage to evaluate business performance

Accounting

Learning Objectives – Chapter 5 Adjust and close the accounts of a merchandising

Слайд 11accounting
Learning Objectives 3
Account for the sale

of merchandise inventory using a perpetual inventory system

Слайд 124. Transportation Cost - Freight Out
The freight in is part

of the inventory cost for the buyer.
The freight out is

a delivery expense to the seller.
Smart Touch Learning pays $30 to ship the June 21 sale to the customer.

accounting

4. Transportation Cost - Freight OutThe freight in is part of the inventory cost for the buyer.The

Слайд 135. Net Sales Revenue
For the year, Smart Touch Learning sells

$297,500 of merchandise inventory. They process $11,200 of sales returns

and allowances, and they award $5,600 of sales discounts.
What is Net Sales Revenue for the year?

accounting

5. Net Sales RevenueFor the year, Smart Touch Learning sells $297,500 of merchandise inventory. They process $11,200

Слайд 145. Net Sales Revenue
For the year, Smart Touch Learning sells

$297,500 of merchandise inventory. They process $11,200 of sales returns

and allowances, and they award $5,600 of sales discounts.
What is Net Sales Revenue for the year?

accounting

Слайд 156. Gross Profit
The difference between Net Sales Revenues and Cost

of Goods Sold
Indicates the amount available to cover operating expenses
For

this example, assume Smart Touch Learning’s Cost of Goods Sold is $199,500; its gross profit is calculated as follows:

accounting

6. Gross ProfitThe difference between Net Sales Revenues and Cost of Goods SoldIndicates the amount available to

Слайд 16 Practice Questions

p312
accounting

Слайд 17 Practice Question Solutions
accounting

Слайд 18Learning Objectives 4
Adjust and close the accounts of a

merchandising business

Accounting

Слайд 19 Adjusting Merchandise Inventory
At the end of the period, actual

inventory on hand may differ from the accounting records in

perpetual inventory system.
This difference can occur because of:
Theft
Damage
Errors
‘Merchandise Inventory’ account must be adjusted at the end of the period

accounting

Adjusting Merchandise InventoryAt the end of the period, actual inventory on hand may differ from the

Слайд 20 Adjusting Merchandise Inventory
Smart Touch Learning’s Merchandise Inventory account shows

an unadjusted balance of $31,530,with no theft or error. But

on December 31, ST Learning counts the inventory on hand, and the total cost comes to only $31,290.
ST Learning records this adjusting entry for inventory shrinkage. And the entry brings Merchandise Inventory to its correct balance.

accounting

Adjusting Merchandise InventorySmart Touch Learning’s Merchandise Inventory account shows an unadjusted balance of $31,530,with no theft

Слайд 21Closing the Accounts of a Merchandiser
Close R to Income Summary
Close

E and contra-revenues(-R) to Income Summary
Close Income Summary to Capital
Close

Withdrawals to Capital

accounting

Closing the Accounts of a MerchandiserClose R to Income SummaryClose E and contra-revenues(-R) to Income SummaryClose Income

Слайд 225-
accounting
Closing in a Merchandiser

Слайд 23Closing the Accounts of a Merchandiser
At this point, the Income

Summary account has a $25,200 balance.
Next, we need to close

Income Summary to the Capital account.

accounting

Closing the Accounts of a MerchandiserAt this point, the Income Summary account has a $25,200 balance.Next, we

Слайд 24Learning Objectives 5
Prepare a merchandiser’s financial statements

Accounting

Слайд 25Merchandiser’s Financial Statements
Income Statement
Single-Step Income Statement
Multi-Step Income Statement (common approach)
Change

in owner’s equity
Balance Sheet
The report format (A at top, L

and O/E at bottom)
The account format (A at left, L and O/E at right)
Cash flow Statement

accounting

Merchandiser’s Financial StatementsIncome StatementSingle-Step Income StatementMulti-Step Income Statement (common approach)Change in owner’s equityBalance SheetThe report format (A

Слайд 26Single-Step Income Statement
Income statement format that groups all revenues together

and then lists and deducts all expenses together without calculating

any subtotals.

accounting

Single-Step Income StatementIncome statement format that groups all revenues together and then lists and deducts all expenses

Слайд 27Multi-Step Income Statement
Multi-step I/S format that contains subtotals to highlight

significant relationships.
Net Sales Revenue
Gross Profit (Gross Margin)
Operating Income
Net Income.

5-
accounting

Multi-Step Income StatementMulti-step I/S format that contains subtotals to highlight significant relationships. Net Sales RevenueGross Profit

Слайд 28Multi-Step Income Statement
COGS: is also called Cost of Sales. It

represents a functional expense.
Gross profit: Net Sales Revenue minus COGS.

It is the extra sale amount the company receives from the customer over what the company paid to the vendor.

accounting

Multi-Step Income StatementCOGS: is also called Cost of Sales. It represents a functional expense.Gross profit: Net

Слайд 29Operating Expenses: Expenses (other than COGS) that occur in the

entity’s major line of business.
Operating income: Gross profit minus operating

expenses . It measures the results of the entity’s major ongoing activities (normal operations).

accounting

Multi-Step Income Statement

Operating Expenses: Expenses (other than COGS) that occur in the entity’s major line of business.Operating income: Gross

Слайд 30Other revenues and expenses: Revenues or expenses that are outside

the normal, day-to-day operations of a business, such as interest

expense, taxes, etc.
Finally, Net Income is determined by subtracting Other Revenues and Expenses from Operating Income.

accounting

Multi-Step Income Statement

Other revenues and expenses: Revenues or expenses that are outside the normal, day-to-day operations of a business,

Слайд 31Statement of Owner’s Equity and the B/S
A merchandiser’s statement of

owner’s equity looks exactly like that of a service business.

Merchandisers have an additional CA, Merchandise Inventory. Service businesses do not have it in B/S.

Accounting

Statement of Owner’s Equity and the B/SA merchandiser’s statement of owner’s equity looks exactly like that of

Слайд 32Learning Objectives 6
Use the gross profit percentage

to evaluate business performance

Accounting

Слайд 33Gross Profit Percentage
Measures the profitability of each sales dollar.
When this

number is trending downward, it can indicate a significant problem.
Useful

profitability ratios

Gross Profit PercentageMeasures the profitability of each sales dollar.When this number is trending downward, it can indicate

Слайд 34Gross Profit Percentage—Example

Слайд 35Gross Profit Percentage—Example

Слайд 36Gross Profit Percentage—Example

Слайд 37Gross Profit Percentage—Example

Слайд 38 Practice Question
accounting

Слайд 39 Practice Question
accounting
a. Sales – they should

try to increase sales, a higher Sales will increase Gross

Profit Percentage
b. Sales Returns and Allowances – they should try to decrease sales returns and allowances, a higher Sales Returns and Allowances will decrease Gross Profit Percentage
c. Cost of Goods Sold – they should try to decrease cost of goods sold, a higher Cost of Goods Sold will decrease Gross Profit Percentage
d. Sales Discounts – they should try to decrease sales discounts, a higher Sales Discount will decrease Gross Profit Percentage