Accounting for Merchandising Businesses


Overview/Description
Target Audience
Expected Duration
Lesson Objectives
Course Number


Overview/Description
A merchandising business is a business that buys goods and sells them for profit. Merchandising businesses, which include wholesalers and retailers, typically handle inventory, therefore accounting procedures exist to record the cost of goods sold or not sold. This course will provide practical information about maintaining accounts and generating financial statements specifically for merchandising businesses. Applying these accounting procedures will help keep a business in control of its goods and ultimately, its profit margin.

Target Audience
Individuals who require knowledge of the basics of accounting, who are starting a business, who are learning to manage the accounting activities of a business, who need to review standard accounting principles and procedures, shareholders, or potential shareholders.

Expected Duration (hours)
2.5

Lesson Objectives

Accounting for Purchases and Sales

  • recognize the benefits of applying specific accounting methods for a merchandising business.
  • apply the rule of debit and credit for purchase transactions, given a scenario.
  • apply the rule of debit and credit for purchase discount and purchase return transactions, given a scenario.
  • apply the rule of debit and credit for sale transactions, given a scenario.
  • apply the rule of debit and credit for sale discount and sale return transactions, given a scenario.

    • Accounting for Merchandise Inventory

  • recognize the benefits of applying accounting methods for maintaining accurate inventory records.
  • identify the appropriate methods being used to account for inventory in a given scenario.
  • apply the steps for adjusting a business' inventory account.

    • Completing the Merchandising Accounting Cycle

  • recognize the benefits of completing the accounting cycle for a merchandising company.
  • calculate the cost of goods sold for a merchandising company, given a scenario.
  • perform the necessary steps to complete an income statement for a merchandising company, given a scenario.
  • sequence the steps that prepare a merchandising company's ledger for the next fiscal period, given a scenario.

    • Course Number:
    FIN0125