c. What would you recommend lui E5.2 (LO 1, 2, 3, 4, 5, 6) K The following are some of the terms discussed in the chapter: 1. Gross profit 9. Sales discounts 10. FOB destination 2. Perpetual inventory system 3. Cost of goods sold 11. Sales allowance 4. Purchase returns 12. Non-operating activities 5. Freight out 13. Profit margin 6. FOB shipping point 14. Contra revenue account 7. Periodic inventory system 15. Merchandise inventory 8. Subsidiary ledger 16. Purchase discounts Instructions Match each term be used at all. ac term with the best description below. Each term may be used more than once, or may not An expense account that shows the cost of merchandise sold A group of accounts that share a common characteristic, such as all inventory accounts An account, such as Sales Discounts, that is deducted from a revenue account on the in- come statement The return of unsatisfactory purchased merchandise Freight terms where the seller will pay for the cost of shipping the goods An inventory system where a physical inventory count is required to determine inventory on hand and establish cost of goods sold A reduction in price given to a customer for unsatisfactory inventory Sales revenue less cost of goods sold Revenues, expenses, gains, and losses that are not part of the company's main operations Freight terms where the buyer will pay for the cost of shipping the goods An inventory system where the cost of goods sold is calculated and recorded with every sales transaction An asset that shows the cost of goods purchased for resale _Profit divided by net sales LA price reduction given by a seller for early payment on a credit sale