IDIS 240 Final Exam - Vestal UPDATED ACTUAL QUESTIONS AND CORRECT
ANSWERS
, Cash Flow Cash in bank > purchased inventory > sold inventory > accounts receivable > cash
in bank
List Price The retail price listed
selling price list price - trade discounts
Net price = selling price - allowable discounts (cash discounts)
Net Sale
Cost of Good Sold (COGS) = Cost of Merchandise + Freight from Manufacturer
Trade Discounts specify term of sale and change of price with how they see fit.
Cash Discounts given to encourage buyers to promote payment promptly.
Special Orders instructions given by the buyer on how to deliver or manufacture the order.
Minimum Order vs. Freight Allowed Minimum order:
The minimum amount you can order from a manufacturer
Freight Allowed:
manufacture pays for the shipping and just adds to the cost.
Claims request for payment from the insurance company to cover financial losses.
Returns goods returned to the business that sold them
Operating Expense (OE) all costs needed to provide necessary services.
SG&A Selling, General and Administrative Expense
EBITDA: Earnings before interest, Taxes, depreciation, = Margin - OE - SG&A
and amortization
EBIT EBITDA - Depreciation and Amortization
Interest Expense Not part of operating cost
NPBT Net profit before taxes
NPAT Net profit after taxes
ANSWERS
, Cash Flow Cash in bank > purchased inventory > sold inventory > accounts receivable > cash
in bank
List Price The retail price listed
selling price list price - trade discounts
Net price = selling price - allowable discounts (cash discounts)
Net Sale
Cost of Good Sold (COGS) = Cost of Merchandise + Freight from Manufacturer
Trade Discounts specify term of sale and change of price with how they see fit.
Cash Discounts given to encourage buyers to promote payment promptly.
Special Orders instructions given by the buyer on how to deliver or manufacture the order.
Minimum Order vs. Freight Allowed Minimum order:
The minimum amount you can order from a manufacturer
Freight Allowed:
manufacture pays for the shipping and just adds to the cost.
Claims request for payment from the insurance company to cover financial losses.
Returns goods returned to the business that sold them
Operating Expense (OE) all costs needed to provide necessary services.
SG&A Selling, General and Administrative Expense
EBITDA: Earnings before interest, Taxes, depreciation, = Margin - OE - SG&A
and amortization
EBIT EBITDA - Depreciation and Amortization
Interest Expense Not part of operating cost
NPBT Net profit before taxes
NPAT Net profit after taxes
