|Quoting af773atmsp (Reply 16):|
What if you walk into a store, steal $20 worth of products. Then come back, return the products and the store gives you a refund. Then you purchase products at that store for $20. Does the store make a loss or a profit from this? My friend and I are questioning this and can't come to a conclusion. Note that I would never actually try this since it is stealing.
Here is how it works with regards to stealings in retail stores. When you steal something, and are not caught, the shop will not find out until next inventory count. Store keeps track of the number of items delivered (or supposedly delivered, sometimes you do not accept into your database items as you actually get them, but as they are on the shipping list, which may be wrong) and number of items sold.
So for example you find you have 15 pieces of item A in the store, on last inventory check you had 14, 10 have been delivered and 8 have been sold. This means that you are missing one item. Obviously, you try to find the missing item, if you still count 14 in stock, you correct the database and register a stock decrease as "unknown loss". Unknown loss means you have no way of finding out what happened. It could have been stolen, sold as a different item (typically, people will try and put luxury personal hygiene items such as parfumes or toothpaste in boxes from cheap, often store-brand products), never delivered, destroyed in-store beyound possible recognition (for example, bottle shattered to pieces by machinery), and anything else you can think of. In contrast, typical known loss is grocery gone bad/past the date.
The important part here is, that this loss registers at purchase price, which can be higher or lower than retail price.
Lets say the purchase price of your 20 bucks worth of stuff is 18 bucks.
So you come back and ask for a refund. Without a valid bill, you should not get one, but this can be circumvented.
Store now accepts your items into stock as if it was delivered by the distributor. If it can still be sold (for example, undamaged, untampered with clothing), it will be put on shelves. So now you go and buy - same stuff? Or some other stuff?
Either way, the store finds out on next inventory count they are missing some items in total purchase value of 18, resale value of 20. Because even though they have 16 items, your refund bumped up "items delivered" count to 11, and 8 have still been sold, plus the 14 they had, should have had 17. If you bought the same thing you returned, they have 15 in stock, 11 delivered, 9 sold, 14 left-over, 1 missing.
other item you bought for 20 bucks had a purchase price of 1, they are in net revenue of 1 dollar, but still, if you never stole item A, just bought item B, it would be 19 dollars.
It is worth noting that income/expenditure/profit/loss are not accounted on per-item basis, rather you take your monetary income from selling stuff, set it against your expenses, such as staff, maintenance, inventory change and so on, and you find out your revenue.
Also it is worth noting that I probably mixed up my accounting termitus technicus.