When a Large Chain of Stores Such as Home Depot

question 106

Multiple Choice

When a large chain of stores such as Home Depot or Kmart buys items centrally from its home office, selling companies often designate these customers as _____ accounts, which means their needs are handled out of the seller's corporate offices, and local salespeople need not attempt to solicit business from any branches in their territories.

• A)house
• B)bounce-back
• C)functional
• D)high service
• E)generational

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Definitions:

Merchandise Inventory

Items that a company holds for the purpose of resale to customers in the ordinary course of business.

Gross Method

An accounting approach for recording purchases at the invoice price without deduction of any cash discounts offered.

Perpetual Inventory System

A strategy for managing inventory accounting that utilizes computerized point-of-sale systems and enterprise asset management software to immediately document sales or purchases.

Accounts Payable

Obligations a business has to its creditors, arising from the purchase of goods and services on credit.