(See related pages)
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| Cash discount | A reduction in the price of merchandise that is granted by a seller to a purchaser in exchange for the purchaser paying within a specified period of time called the discount period. (See page(s) 270) |
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| Catalogue price | See list price. (See page(s) 270) |
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| Classified, multiple-step income statement | An income statement format that shows intermediate totals between sales and net income and detailed computations of net sales and cost of goods sold. (See page(s) 282) |
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| Cost of goods sold | The cost of merchandise sold to customers during a period. (See page(s) 264) |
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| Credit memorandum | A notification that the sender has entered a credit in the recipient's account maintained by the sender. (See page(s) 277) |
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| Credit period | The time period that can pass before a customer's payment is due. (See page(s) 270) |
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| Credit terms | The description of the amounts and timing of payments that a buyer agrees to make in the future. (See page(s) 270) |
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| Debit memorandum | A notification that the sender has entered a debit in the recipient's account maintained by the sender. (See page(s) 269) |
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| Discount period | The time period in which a cash discount is available and a reduced payment can be made by the buyer. (See page(s) 270) |
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| EOM | The abbreviation for end of month, used to describe credit terms for some transactions. (See page(s) 270) |
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| FOB | The abbreviation for free on board, the designated point at which ownership of goods passes to the buyer; FOB shipping point (or factory) means that the buyer pays the shipping costs and accepts ownership of the goods at the seller's place of business; FOB destination means that the seller pays the shipping costs and the ownership of the goods transfers to the buyer at the buyer's place of business. (See page(s) 272) |
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| Freight-in | See transportation-in. (See page(s) 273) |
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| Freight-out | See transportation-out. (See page(s) 273) |
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| General and administrative expenses | Expenses that support the overall operations of a business and include the expenses of such activities as providing accounting services, human resource management, and financial management. (See page(s) 282) |
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| Goods and Services Tax (GST) | A federal tax on almost all goods and services provided in Canada. (See page(s) 306) |
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| Gross margin | The difference between net sales and the cost of goods sold; also called gross profit. (See page(s) 265) |
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| Gross margin ratio | See gross profit ratio. (See page(s) 285) |
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| Gross profit | The difference between net sales and the cost of goods sold; also called gross margin. (See page(s) 265) |
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| Gross profit ratio | Gross profit from sales (net sales minus cost of goods sold) divided by net sales; also called gross margin ratio. (See page(s) 285) |
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| Inventory | See merchandise inventory. (See page(s) 265) |
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| List price | The catalogue price of an item before any trade discount is deducted. (See page(s) 270) |
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| Merchandise | Products, also called goods, that a company acquires for the purpose of reselling them to customers. (See page(s) 264) |
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| Merchandise inventory | Products that a company owns for the purpose of selling them to customers. (See page(s) 265) |
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| Merchandiser | Earns net income by buying and selling merchandise. (See page(s) 264) |
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| Periodic inventory system | A method of accounting that records the cost of inventory purchased but does not track the quantity on hand or sold to customers; the records are updated at the end of each period to reflect the results of physical counts of the items on hand. (See page(s) 267) |
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| Perpetual inventory system | A method of accounting that maintains continuous records of the cost of inventory on hand and the cost of goods sold. (See page(s) 266) |
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| Provincial Sales Tax (PST) | A consumption tax applied on sales to the final consumers of products and/or services. (See page(s) 306) |
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| Purchase discount | A term used by a purchaser to describe a cash discount granted to the purchaser for paying within the discount period. (See page(s) 270) |
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| Purchase returns and allowances | A contra expense account used when a periodic inventory system is in place in which purchase returns and/or purchase allowances are recorded. (See page(s) 294) |
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| Retailer | A middleman that buys products from manufacturers or wholesalers and sells them to consumers. (See page(s) 264) |
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| Sales discount | A term used by a seller to describe a cash discount granted to customers for paying within the discount period. (See page(s) 275) |
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| Sales returns and allowances | A contra revenue account in which sales returns and/or sales allowances are recorded. (See page(s) 276) |
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| Selling expenses | The expenses of promoting sales by displaying and advertising the merchandise, making sales, and delivering goods to customers. (See page(s) 282) |
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| Shrinkage | Inventory losses that occur as a result of shoplifting or deterioration. (See page(s) 278) |
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| Single-step income statement | An income statement format that includes cost of goods sold as an operating expense and shows only one subtotal for total expenses. (See page(s) 284) |
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| Trade discount | A reduction below a list or catalogue price that may vary in amount for wholesalers, retailers, and final consumers. (See page(s) 270) |
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| Transportation-in | The cost to the purchaser to transport merchandise purchased to the purchaser; transportation-in is part of Cost of Goods Sold. (See page(s) 273) |
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| Transportation-out | The cost to the seller to transport merchandise sold to the customer, transportation-out is a selling expense. (See page(s) 273) |
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| Wholesaler | A middleman that buys products from manufacturers or other wholesalers and sells them to retailers or other wholesalers. (See page(s) 264) |