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Merchandising Businesses (Accounting) - Explained

What is a Merchandising Business?

Written by Jason Gordon

Updated at April 7th, 2022

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Table of Contents

What is a Merchandising Businesses? 

What is a Merchandising Businesses? 

A merchandising business is a business that generates revenue by selling goods (a product or inventory).  There are two types of merchandising businesses

  • Wholesale company - A wholesale company sells items in bulk to other businesses. 
  • Retail company - A retail company sells products to the end user or the consumer.

In a merchandising business, you have another type of account that you have to worry about - inventory. The goods that we sell - those products - are merchandise inventory. Inventory is the account used for  products that a company owns and intends to sell. 


Back to: Accounting & Taxation

Related Topics

  • What is Merchandising? – Financial Accounting
  • Recognizing Inventory Sales – Financial Accounting
  • Perpetual vs Period Systems – Financial Accounting
  • Special Merchandising Transactions – Financial Accounting
  • Adjustments for Inventory – Financial Accounting
  • Multi-Step Income Statement – Financial Accounting
  • Accounting Cycle for Merchandising Business Example Part 1
  • Accounting Cycle for Merchandising Business Example Part 2
  • Accounting Cycle for Merchandising Business Example Part 3
merchandising business inventory business

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