How does merchandising businesses differ from service businesses when it comes to accounting?
A merchandising business sells products to customers, whereas a
service business provides or sells services to customers.
For example: A beauty salon is considered a service business
because you are providing a service to the customers. in the case
of a beauty salon, the service could be cutting hair, doing
someones eyebrows, etc.
A sports store such as Sports Mart is considered a merchandising
business because you are selling products to customers. in this
case the products could be shoes, hockey sticks, etc.
Merchandising business has inventory.