Card Set Information
Contra Expense Account
An account that is offset against (reduces) an expense account on the income statement.
Ex. "purchase returns and allowances" and "purchase discounts"
Contra Revenue Account
An account that is offset against (reduces) a revenue account on the income statement.
Ex. "Sales returns and allowances" and "Sales discounts"
Cost of goods available for sale
The sum if beginning inventory and the cost of goods purchased
Cost of Goods purchased
The sum of net purchases and freight in
Cost of goods sold
The total cost of merchandise sold during the period. In a perpetual inventory system, it is calculated and recorded for each sale.
In a periodic inventory system, it is calculated at the end of the accounting period by DEDUCTING ending inventory from the cost of goods available for sale.