Accounts Used by a Merchandising Business
Merchandise
Goods bought for resale are known as merchandise. A merchandising business buys goods from a wholesaler or a manufacturing business, then sells these goods to its customers. For example, consider Wal-Mart, who buys goods in bulk from various manufacturers and wholesalers, and then resells those goods to its customers. The goods that are bought for resale are called merchandise.
Merchandisers:
Merchandisers transfer ownership from a manufacturer to the customer, who buys the goods for his or her own use. A merchandiser could be a wholesaler or a retailer.
Merchandising businesses use two types of accounts. They are:
- Merchandising Inventory Account
- Sales Account
Click each type to learn more.