Financial accounting college question?
What accounts are different on an Income Statement and Balance Sheet for a
merchandising business compared to a service business?
This is a question for my financial accounting class. It would be really helpful if someone could answer this question or at least point me in the right direction. Thanks.
- 1 decade agoFavorite Answer
possibly unearned income for the service business
inventory for the merchandise business
- 1 decade ago
Merchandising companies deal with physical products as opposed to services, so all the expenses relating to purchasing, selling, shipping, warehousing products will be different. That is to say a merchandising company's income statement will include purchases, freight in, freight out, maybe warehouse wages and operating expenses, possibly drivers wages, etc. On the balance sheet there will be an account for inventory in the current asset section, and in the Property Plant & Equip you might see Warehouse Equipment and maybe a fleet of trucks. None of this would likely be present for a service organization.
- CasimirLv 44 years ago
It is true that your assets, as well as those of your parents, are taken into consideration in financial aid decisions. They will NOT deny you financial aid for that reason, but if you have a substantial sum of money it will reduce the amount of aid you will receive - colleges will expect you to use the money you've saved toward college expenses. Most people are far, far better off saving for college and taking the proportionally smaller hit in financial aid funds, but it's possible you could be an exception. You should talk to your high school college counselor to get all the details. If your family has a financial planner it may also be useful to speak to him/her.