accounting 1

FOB destination

Refers to credit terms where goods in transit are owned by the seller

Credit period

The amount of time allowed by a seller before payment is due from the buyer

Perpetual inventory system

A method in which cost of goods sold is recorded at the time of each sale

Merchandiser

A type of business that earns income by buying and selling merchandise

Merchandise inventory

A current asset that includes the cost to buy goods and make them ready for sale

FOB shipping point

Refers to credit terms where goods in transit are owned by the buyer

Discount period

Time period in which a cash discount is available

Sales discount

Seller’s description of a cash discount granted to buyers in return for early payment