A215 Class09

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Unformatted text preview: ssign to inventory that is sold? -4 methods -Inventory turnover -Average days in inventory -Gross profit margin Today’s Topics Illustration 6-3 Today’s Topics Illustration 6-3 PURCHASING INVENTORY CARRYING INVENTORY CARRYING INVENTORY SELLING INVENTORY Getting Started • Manufacturing inventory versus merchandising inventory - Manufacturing inventory consists of three categories: - - Raw materials inventory Work-in-process inventory Finished-goods inventory Reported in one inventory account on balance sheet Merchandising (often called “retail”) inventory consists of one category: - Inventory CH 6 focuses on merchandising inventory Getting Started • Tracking inventory and related costs: - Perpetual method - - Maintains a continual record of inventory purchased and sold (we have been using this method so far). Periodic method - Periodically adjusts for purchases and sales of inventory at the end of the reporting period based on a physical count of inventory. - Uses multiple temporary accounts which are closed into inventory at the end of the reporting period. Purchasing Inventory • W...
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This document was uploaded on 02/17/2014 for the course ACCTG 215 at University of Washington.

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