1. What are the two inventory systems to account for the purchase and sale of merchandise?
2. How do retail business account for the purchase of merchandise from suppliers?
3. How do retail businesses account for the sale of merchandise to their customers?
4. What are the adjustments at the end of the period to account for amounts of “expected” returns and allowances in the future from sales of the current period?
5. What is the method and thought process to account for inventory shortages (e.g. due to theft and/or errors)?
6. What new accounts now appear on the financial statements (I/S, SE, B/S, and CF)?
7. How is the income statement presented to represent different costs and revenues of a retail business?
8. How are the remaining financial statements (SE, B/S, CF) affected by a retail operation?
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