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                                APPENDIX A
     
           CPA-LEDGER AND THE INCOME STATEMENT'S COST OF GOODS SOLD      
     
     
     
     CPA-LEDGER  can  be used for businesses with merchandise inventory and 
     purchases (which need a Cost of  Goods  Sold  Section  in  the  Income 
     Statement)  and for service establishments which do not need a Cost of 
     Goods Sold section. 
     
     CPA-LEDGER senses which one is applicable but looking at the accounts 
     that you include in your general ledger.  
     
          .  If you (1) DO NOT  include  an  account  under  the  purchases 
             category  while  using Option 1 of the SETUP menu,  AND if you 
             (2) DO  NOT  identify  an  account  as  beginning  merchandise 
             inventory  while using Option 2 of the SETUP menu,  AND if you 
             (3) DO NOT add an account for beginning merchandise  inventory 
             later while using Option 8 of the DAILY menu,  CPA-LEDGER WILL 
             NOT PRINT the Cost of Goods Sold section when  preparing  your 
             Income  Statements.  Stated  another  way,  BOTH the beginning 
             inventory account AND the purchases related accounts  must  be 
             absent in order to bypass the Cost of Goods Section. 
     
          .  If  you (1) DO include an account under the purchases category 
             while using Option 1 of the SETUP  menu,  OR  if  you  (2)  DO 
             identify  an  account as beginning merchandise inventory while 
             using Option 2 of the SETUP menu,  OR if you  (3)  DO  add  an 
             account  for  beginning  merchandise  inventory later by using 
             Option 8 of the DAILY menu,  CPA-LEDGER WILL PRINT the Cost of 
             Goods  Sold  Section  of the Income Statement.  Stated another 
             way,  EITHER a beginning  inventory  account  OR  a  purchases 
             related  account  will cause the Cost of Goods Sold section to 
             be printed. 
          
     
     It is as simple as that.
     
        
     
     
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