IDIS 240 EXAM 1 VESTAL QUESTIONS AND
ANSWERS 2025
List price - ...ANSWER... ✔ ✔published price of item
selling price - ...ANSWER... ✔ ✔= list price - trade
discounts(amnt appears on invoice)
selling price - ...ANSWER... ✔ ✔COGS
= ----------------------------
100% - %GM
net price - ...ANSWER... ✔ ✔actual money received
after discounts and adjustments
what you pay after cash discounts
selling price - allowable discounts
COGS - ...ANSWER... ✔ ✔Cost of Goods Sold
,2|Page
Cost of Goods Sold eq - ...ANSWER... ✔ ✔= (Cost
of merchandise) + (freight from Manufacturer)
FOB - ...ANSWER... ✔ ✔"free on board" - when the
price of the good includes the cost the freight
Freight - desitination - ...ANSWER... ✔
✔manufacturer puts item on truck and pays for it
- they own the goods while they're in transit
Freight - Shipping it - ...ANSWER... ✔
✔manufacturer puts on truck and distributor pays
shipping
- buyer owns goods while in transit
Trade discounts - ...ANSWER... ✔ ✔- specified in
sale (
- offered due to fluctuations in market conditions and
cost of the raw materials
trade pricing (Matrix pricing) - ...ANSWER... ✔
✔negotiating the actual price that will be paid
,3|Page
cash discounts - ...ANSWER... ✔ ✔discount for
paying cash (no credit)
Special orders - ...ANSWER... ✔ ✔modifications
design, finish, material, pakcing of order
minimum order - ...ANSWER... ✔ ✔amount that must
be ordered
(amount of freight that must be ordered)
Freight allowed - ...ANSWER... ✔ ✔certain amount
needed for free shipping
claims - ...ANSWER... ✔ ✔item that are damaged
REturns - ...ANSWER... ✔ ✔given item back because
they don't want it
Cash flow - ...ANSWER... ✔ ✔Cash in bank ->
Purchase Inventory -> Sold Inventory -> Account
Receivable -> Cash in Bank
, 4|Page
Margin Gross Margin - ...ANSWER... ✔ ✔= selling
price - COGS - Adjustments
difference btwn what distrib. pays and sells
GM - ...ANSWER... ✔ ✔Gross Margin
Percent Gross Margin - ...ANSWER... ✔ ✔[(selling
price - COGS) / (selling price)] * 100%
%GM - ...ANSWER... ✔ ✔Percent Gross Margin
Markup - ...ANSWER... ✔ ✔Money markup price
Percent Markup - ...ANSWER... ✔ ✔(selling price -
COGS)
-------------------------- * 100%
(COGS)
OE - ...ANSWER... ✔ ✔Operating Expenses