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Unformatted text preview: Increase Increase-Inventory Purchases Sell inventory Increase COGS INo entry-Reduce Inventorv Count Adjust balance to Record inventory, Inventory , count close purchases land create cost of laoods sold 7 * Purchase and Sales Adjustments * ~ Purchase returns and allowances: deduct from cost of inventory purchases Purchase discount: cash discount given for early payment 6-tJvdc )- Sales returns and allowances: deduct from sales revenue ). Sales discount: cash discount given for early payment FOB shipping point" vs. FOB destination ). Net Sales 0: : Gross Sales- Sales R&A-Sales Disc. ""<1214 Ratio Analysis );> Recall from multistep income statement, Net Sales - COGS = Gross Profit rGross Profit Percentage GP% = Gross Profit Net Sales 9 Cbap.6 C"p, 6 C~\(er ~Jef t O\(ers:'f a rv}. MIlF-.e,. PyO f \ r...
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This note was uploaded on 09/01/2011 for the course ACCT 284 taught by Professor Clem during the Fall '08 term at Iowa State.
- Fall '08