Table of contents

1. Introduction to Accounting1h 21m
2. Transaction Analysis1h 13m
3. Accrual Accounting Concepts2h 38m
4. Merchandising Operations2h 30m
5. Inventory1h 55m
6. Internal Controls and Reporting Cash1h 16m
7. Receivables and Investments3h 8m
8. Long Lived Assets5h 1m
9. Current Liabilities2h 19m
10. Time Value of Money1h 23m
- Time Value of Money Equations
  35m
- Using Time Value of Money Tables
  47m
11. Long Term Liabilities2h 45m
12. Stockholders' Equity2h 15m
13. Statement of Cash Flows2h 24m
14. Financial Statement Analysis5h 25m
15. GAAP vs IFRS56m

4. Merchandising Operations

Net Sales

Financial Accounting

4. Merchandising Operations

Net Sales

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Multiple Choice

Which of the following actions would best help Alana gain a better understanding of her spending patterns in relation to net sales?

Ignore returns and allowances when analyzing sales data.

Only focus on increasing gross sales without tracking expenses.

Review detailed sales reports and compare them to expense records over time.

Rely solely on annual financial statements without examining monthly trends.

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Verified step by step guidance

Understand the concept of net sales: Net sales are calculated as gross sales minus returns, allowances, and discounts. This provides a clearer picture of actual revenue generated.

Recognize the importance of detailed sales reports: Detailed sales reports break down sales data into smaller, more manageable segments, such as daily, weekly, or monthly sales figures, which can help identify trends and patterns.

Compare sales data to expense records: By analyzing expense records alongside sales data, Alana can determine how her spending aligns with her revenue generation, helping her identify areas for improvement or cost control.

Focus on trends over time: Reviewing data over time, such as monthly or quarterly trends, provides insights into seasonal fluctuations, recurring expenses, and the overall financial health of the business.

Avoid relying solely on annual financial statements: Annual financial statements provide a broad overview but lack the granularity needed to understand specific spending patterns or short-term trends.