Accounting question help please I am lost!?

Question

What items appear on the merchandising company statements that don’t appear on the service company statements? Why is there a difference?

Answer 1

See if you can get help here

http://www.futureaccountant.com/

Answer 2

Well there are many differences that will be seen from a mechandising company and a service company. From a novice standpoint, the most important concept you should get is that Merchandisers will carry "Inventory" on their balance sheets. As this inventory is sold it will become "Cost of Goods Sold" and "Sales Revenue". A service company generally does not have inventory on their books and recognizes revenue by crediting "Service Revenue".

Answer 3

Basically it is splitting it up between non-inventory and inventory. So if there is a product an actual item it would be on the merchandising company statements (inventory). If it is a service where there is not a physical good then it would show up on the service company statments (non-inventory).

Answer 4

There are so many differences, where to start. Think of their businesses and that will tell you of the differences. One sells things, so they get revenues upon a sale, their costs are mostly fromt he cost of good sold. They also carry inventory and must mark that inventory and deal with theft, etc. A service company gets revenues from providing a service, and all that goes along with that. Most of their costs are going to be personnel, with limited inventory. All the ratios will be different.

Answer 5

Single biggest difference is that the merchandiser will list the cost per unit - often the wholesale cost. The service invoice will charge retail prices, and that unit cost would not appear.