Which of the Following Represents the Thinking Behind Used Goods

question 97

Multiple Choice

Which of the following represents the thinking behind used goods retailers?

• A) They sell items from a full-line discount stock to customers who are drawn in primarily by the food on sale.
• B) They sell overruns,irregular merchandise,and/or overstocks purchased from manufacturers at or below cost.
• C) They offer a nearly complete selection of merchandise within a single category and use self-service,discount prices,high volume,and high turnover to their advantage.
• D) They turn customers into suppliers by buying back pre-owned items from customers and reselling to different customers.

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Definitions:

Immediate Recognition

The accounting practice of reporting revenue or expenses in the current period as they are incurred, without deferral.

Sales Commissions

The expense related to the payment of commissions to sales personnel, typically calculated as a percentage of the sales revenue they generate.

Expense Recognition

An accounting principle that dictates when the cost of business operations should be recorded in the financial statements.

Cost of Goods Sold

The direct costs attributable to the production of the goods sold by a company.