The calculation of Net Purchases does NOT include:
A) Purchases Returns and Allowances.
B) Purchases Discounts.
C) Purchases.
D) Merchandise Inventory.

Question

Quizplus · Accepted Answer

Net Purchases is calculated by adding Purchases to Freight In, then subtracting Purchases Returns and Allowances and Purchases Discounts. Merchandise Inventory is not included in the calculation of Net Purchases; it is a separate account that represents the cost of goods available for sale.

The Calculation of Net Purchases Does NOT Include