Accounting Inventory

Accounting Inventory - because inventory is less liquid...

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Accounting Inventory Although the accounting cycle and the basic accounting principles are the same for companies that  sell merchandise and companies that provide services, merchandising companies use several  accounts that service companies do not use. The balance sheet includes an additional current asset  called  merchandise inventory , or simply  inventory , which records the cost of merchandise held for  resale. On balance sheets, the inventory account usually appears just below accounts receivable 
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Unformatted text preview: because inventory is less liquid than accounts receivable. Music World Partial Balance Sheet June 30, 20XX ASSETS Current Assets Cash $10,000 Accounts Receivable 2,000 Inventory 37,000 Supplies 1,000 Prepaid Insurance 2,000 Total Current Assets $52,000 Merchandising companies also have several specific income statement accounts designed to provide detailed information about revenues and expenses associated with salable merchandise....
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This note was uploaded on 11/14/2011 for the course ACCT 1310 taught by Professor Staff during the Fall '10 term at Texas State.

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