New User Special Price Expires in

Let's log you in.

Sign in with Facebook


Don't have a StudySoup account? Create one here!


Create a StudySoup account

Be part of our community, it's free to join!

Sign up with Facebook


Create your account
By creating an account you agree to StudySoup's terms and conditions and privacy policy

Already have a StudySoup account? Login here

AC 210 Chapter 6 Notes

by: Carter Cox

AC 210 Chapter 6 Notes AC 210

Carter Cox

Preview These Notes for FREE

Get a free preview of these Notes, just enter your email below.

Unlock Preview
Unlock Preview

Preview these materials now for free

Why put in your email? Get access to more of this material and other relevant free materials for your school

View Preview

About this Document

Covers all of chapter 6 Operating Cycle Inventory Systems (Perpetual and Periodic) Inventory Sales and Control Sales Returns and Allowances
Intro to Accounting
Lisa McKinney
Class Notes
25 ?




Popular in Intro to Accounting

Popular in Department

This 3 page Class Notes was uploaded by Carter Cox on Monday October 10, 2016. The Class Notes belongs to AC 210 at University of Alabama - Tuscaloosa taught by Lisa McKinney in Fall 2016. Since its upload, it has received 19 views.


Reviews for AC 210 Chapter 6 Notes


Report this Material


What is Karma?


Karma is the currency of StudySoup.

You can buy or earn more Karma at anytime and redeem it for class notes, study guides, flashcards, and more!

Date Created: 10/10/16
AC-210 Chapter 6 Notes Operating Cycle - Series of activities that a company undertakes to generate revenues and cash - Differences o Merchandisers  Report inventory as current asset  Earn revenue from sales  Report (CGD) Cost of Goods Sold o Service Companies  Report supplies  Earn revenue from services  Don’t incur CGS because they don’t sell goods Inventory Systems - 3 accounts are important - Inventory o Merchandiser’s total cost of acquiring goods that it has not yet sold - Sales Revenue o Total selling price of all goods that the merchandiser did sell to customers - Cost of Goods Sold o Total cost of all goods that the merchandiser did sell to customers - (Sales Revenue) – (Cost of Goods Sold)= Gross profit - (Beginning Inventory) + (Purchases) – (Ending Inventory) = Cost of Goods Sold - (BI + P) o Represents the cost of goods available for sale - (Beginning Inventory + Purchases) = Goods Available for Sale Periodic Inventory System - Updates the inventory records for merchandise purchases, sales, and returns only at the end of the accounting period - To determine how much inventory is on hand and how much has been sold, periodic systems require that inventory be physically counted by the employees at the end of the period - Uses o BI + P – EI = CGS - Not up to date records - Cant estimate shrinkage Perpetual - Updated every time inventory is bought, sold, or returned - Uses o BI + P – CGS = EI - Combined with bar codes and optical scanners - Continuous tracking - Can estimate shrinkage Inventory Control - Periodic Inventory System o Not up to date records o Cannot estimate shrinkage - Perpetual Inventory System o Continuous Tracking o Can estimate shrinkage Recording Inventory Sales - Every merchandise sale has two components, each of which requires an entry in a perpetual inventory system - Every merchandise sale has two components (selling price and cost_ - A o Cash (Debit) o Sales Revenue (Credit) - B o Cost of Goods Sold (expense) (Debit) o Inventory (credit) Recording Inventory Sales - Merchandisers earn revenue by transferring control of merchandise to a customer either for cash or on credit - Merchandiser who is shipping goods to a customer o FOB Shipping Point  The sale is recorded when the goods leave the sellers shipping department o FOB Destination  The sale is recorded when the goods reach their destination (Customer) Sales Returns and Allowances - When goods sold to a customer arrive in a damaged condition or are otherwise unsatisfactory, the customer can o 1) Return them for a full refund o 2) Keep them and ask for a reduction in the selling price, called allowance


Buy Material

Are you sure you want to buy this material for

25 Karma

Buy Material

BOOM! Enjoy Your Free Notes!

We've added these Notes to your profile, click here to view them now.


You're already Subscribed!

Looks like you've already subscribed to StudySoup, you won't need to purchase another subscription to get this material. To access this material simply click 'View Full Document'

Why people love StudySoup

Jim McGreen Ohio University

"Knowing I can count on the Elite Notetaker in my class allows me to focus on what the professor is saying instead of just scribbling notes the whole time and falling behind."

Allison Fischer University of Alabama

"I signed up to be an Elite Notetaker with 2 of my sorority sisters this semester. We just posted our notes weekly and were each making over $600 per month. I LOVE StudySoup!"

Steve Martinelli UC Los Angeles

"There's no way I would have passed my Organic Chemistry class this semester without the notes and study guides I got from StudySoup."


"Their 'Elite Notetakers' are making over $1,200/month in sales by creating high quality content that helps their classmates in a time of need."

Become an Elite Notetaker and start selling your notes online!

Refund Policy


All subscriptions to StudySoup are paid in full at the time of subscribing. To change your credit card information or to cancel your subscription, go to "Edit Settings". All credit card information will be available there. If you should decide to cancel your subscription, it will continue to be valid until the next payment period, as all payments for the current period were made in advance. For special circumstances, please email


StudySoup has more than 1 million course-specific study resources to help students study smarter. If you’re having trouble finding what you’re looking for, our customer support team can help you find what you need! Feel free to contact them here:

Recurring Subscriptions: If you have canceled your recurring subscription on the day of renewal and have not downloaded any documents, you may request a refund by submitting an email to

Satisfaction Guarantee: If you’re not satisfied with your subscription, you can contact us for further help. Contact must be made within 3 business days of your subscription purchase and your refund request will be subject for review.

Please Note: Refunds can never be provided more than 30 days after the initial purchase date regardless of your activity on the site.