When Setting Prices for Merchandise, Retailers Must Decide on the Markup

question 114

Multiple Choice

When setting prices for merchandise, retailers must decide on the markup, the markdown, and the ________ for markdowns.

• A) relevance
• B) necessity
• C) percentage
• D) timing
• E) consequence

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Definitions:

Recognizes Revenues

The process of recording revenue in the financial statements when it is earned and realizable, in accordance with the revenue recognition principle.

Expense Recognition Principle

Accounting principle that dictates expenses should be recognized in the period in which they are incurred to generate revenues.

Accounting Period

This is a specific duration of time for which financial statements are prepared to understand and evaluate a company's financial performance.

Earned

Refers to income or revenue that a company has generated from its operations or business activities.