Question

Match each of the following terms (a-h) with the correct definition below. Clear All 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. Periodic inventory system Statement where net income is determined by deducting all expenses from all revenues. Multiple-step income statement Inventory system that updates the merchandise inventory account for every purchase and sale transaction. FOB shipping point Payment arrangements determined by the seller as to when invoices are due and whether early payment discount is offered. Perpetual inventory system Shipping terms where the ownership of merchandise passes to the buyer when the seller delivers the merchandise to the freight carrier. FOB destination Inventory shrinkage Statement that includes subtotals for net sales, gross profit, and net operating income in determining net income. Single-step income statement Losses of inventory due to theft, damage, spoilage, etc. that cause the actual inventory on hand to be less than that on record. Credit terms Shipping terms where the ownership of merchandise passes to the buyer when the buyer receives the merchandise.

Answer 1

Answer a-h matched

	Answer
Inventory system that updated the merchandise inventory account only at the end of the accounting period based on a physical count of merchandise on hand	periodic inventory system
Statement where net income is determined by deducting all expenses from all revenues	Single step Income statement
Inventory system that updated the merchandise inventory account for every sale and purchases	Perpetual Inventory system
Payment arrangements determined by the seller as to when invoices are due and whether early payment discount is offered	Credit Items
Shipping Terms where the ownership of merchandise passes to the buyer when the seller delivers the merchandise to the freight carrier	FOB Shipping point
Statement that includes subtotals for net sales, gross profit, and net operating income in determining net income	Multi step Income statement
Losses of of inventory due to theft, damage,spoilage , etc. that cause the actual inventory on hand to be less than that on record	Inventory shrinkage
Shipping Terms where the ownership of merchandise passes to the buyer when the buyer receives the merchandise	FOB Destination Point