Week 6 · Readings & resources

Week 6 — Readings & Resources

Financial Accounting Free sample edition

Your primary reading is Chapter 6 (in this module). Everything below is the optional, go-deeper layer — pick what helps, skip the rest.

How to use this page

This page has 10 items (4 readings and 6 videos). Allow 49–56 minutes for everything. Each group points back to the matching chapter section and class-session segment, so use the full menu when you want more, or take the quick path below.

Every video here has captions: turn them on with the CC button in the player. The chapter covers the same ideas in text.

Pick-one quick path (17–20 min total)

① Perpetual or periodic: when you know the cost

Chapter 6, Section “Compare perpetual and periodic inventory systems” · Session 1, Segment 2, “Perpetual and periodic systems” · Remember: a perpetual system updates Inventory and Cost of Goods Sold at every sale, and a periodic system finds cost of goods sold from a count.

Perpetual vs. Periodic Inventory Systems - Whiteboard Wednesday — Fishbowl Inventory — an inventory-software company's short whiteboard talk: the perpetual system updates cost of goods sold as goods are bought and sold, with two journal entries for each sale, while the periodic system records purchases and sales separately and finds cost of goods sold with an entry at the end of the period. Its closing advice to move to software is the company's own pitch; this course compares the two systems by their effects and ranks neither. (video, 3 min) (captions: automatic)
Periodic vs. Perpetual Inventory & Cycle Counts: Secret Life of Inventory — inFlow Inventory — a three-minute conversation from another software company on why a periodic business knows its stock only as of its last count, why counts are disruptive, and why even a perpetual system still needs counts to check that the records match the shelves. Use it while working through the Week-6 module overview. (video, 3 min) (captions: creator)
Periodic vs. perpetual inventory — inFlow Inventory — the same company's article on how each system tracks stock, the periodic formula of beginning inventory plus purchases minus ending inventory, and the trade-offs of each. Skip its product promotion and its recommendation of one system; its mention of FIFO and LIFO is outside this week's chapter. (reading, 5–7 min)

② Who pays the freight, and when the bill is due

Chapter 6, Section “Record a purchase: credit terms and freight” · Session 1, Segment 3, “Credit terms and freight” · Remember: under FOB shipping point the buyer pays the freight and adds it to inventory cost, and 2⁄10, n⁄30 offers 2 percent off for paying within 10 days.

FOB Shipping Point vs FOB Destination Explained: Freight, Risk & Ownership, Who Pays & Bears Risk? — 10 Min For Supply Chain — a three-minute logistics explainer that follows one damaged truckload from supplier to customer: under FOB shipping point the buyer generally bears the risk in transit and pays the freight, and under FOB destination the seller does, unless the contract says otherwise. It also warns not to confuse these domestic terms with the international trade term FOB, which has its own rules. Its shipment value is the video's own example. (video, 3 min) (captions: automatic)
§ 2-319. F.O.B. and F.A.S. Terms — Legal Information Institute — the Uniform Commercial Code's own section on F.O.B. terms; read subsection (1)(a) on F.O.B. the place of shipment, where the seller's expense and risk end when the goods are put in the carrier's possession, and (1)(b) on F.O.B. the place of destination, where the seller carries the goods there at its own expense and risk. Skip the rest, which covers ocean shipping terms. (reading, 3–5 min)
What Is The Ordinary Dating Method For Cash Discounts Explained -How To Determine Discount Due Dates — Whats Up Dude — a three-minute explainer on reading credit terms written like 2⁄10, n⁄30 on an invoice: the first number is the percent off, the second is the days allowed to earn it, and net 30 is the days before the full amount is due. It works a 2 percent discount on a small invoice, then counts the discount date and the due date on a calendar, starting the count the day after the invoice date. Its invoice amount and dates are the video's own example, not course figures; the chapter applies the same terms to the bicycle shop's purchase. (video, 3 min) (captions: creator)
Net D — Wikipedia — a short encyclopedia entry on net payment terms such as net 30, with a worked case of 2⁄10 net 30: pay within 10 days and take 2 percent off, or pay the full amount within 30 days. Its invoice amount is the entry's own example, not a course figure. (reading, 3–4 min)

③ From cost of goods sold to the multi-step statement

Chapter 6, Section “Compute gross profit and build a multi-step income statement” · Session 2, Segment 6, “Gross profit and the multi-step income statement” · Remember: gross profit is sales revenue minus cost of goods sold, and the multi-step statement subtracts operating expenses after it.

Cost Of Goods Sold (COGS) explained — The Finance Storyteller — a sketched explainer that reads cost of goods sold off several public companies' income statements, then works a small purchase and sale with three journal entries, gross profit, the inventory left on hand, and the formula of beginning inventory plus purchases minus ending inventory. Stop before its FIFO and LIFO bonus section, which this week's chapter does not cover. The company figures are the video's own; the course keys none of them. (video, 11 min) (captions: creator)
Creating a Multi-Step Income Statement — Learning with Luke — a worked example that builds a multi-step income statement from an adjusted trial balance, line by line: net sales after sales returns and allowances and sales discounts (the seller's side of a discount for paying early), cost of goods sold, gross profit, operating expenses split into general and administrative expenses and selling expenses, income from operations (the chapter's operating income), other revenues and expenses, and net income, then a single-step statement that reaches the same net income. This builds on Week 5's work with the income statement. Its dollar amounts are the video's own example. (video, 9 min) (captions: automatic)

Optional one-stop reference (free online reference)

Beginners' Guide to Financial Statements: Income Statements — U.S. Securities and Exchange Commission — the SEC's plain-language guide; read its income statements section, which walks the statement like a staircase from net sales through cost of sales, gross profit, operating expenses, operating income, and interest to net income. Skip the earnings-per-share and ratio sections for now. (reading, 6–8 min)

Heads-up (links rot): these point to outside sites that occasionally move or rename pages. If a link ever fails, tell your instructor and use the reference above in the meantime.

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