Discussion Questions 1. What is the order for listing accounts in the Current Assets section of the balance sheet? 2. What is the difference between the cost of goods available for sale and the cost of goods sold? 3. What are the basic classifications found on an income statement for a merchandising business as compared to a service business? 4. On a balance sheet, what is the difference between Current Liabilities and Long- Term Liabilities? Give an example of an account in each classification. 5. On an income statement, what is the difference between income from operations and net income? Which is more useful in comparing the results of operations over a number of years? 6. Explain the calculation of net sales and net purchases. 7. In the closing procedure, what happens to (a) Purchases Discounts, (b) Sales. Returns and Allowances, (c) Freight In, and (d) Gain on Disposal of Property and Equipment? 8. What are the rules for recognizing whether an adjusting entry should be reversed? 9. What two measures are