2. What is the primary distinction between a service company and a manufacturing or merchandising company? 3. What is the difference among raw materials inventory, work-in-process inventory, and finished goods inventory? 4. Define the cost of goods available for sale. How does it relate to cost of goods sold and ending inventory? 5. For a company like BEST BUY, what does the balance of Cost of Goods Sold in the income statement represent? 6. What is the difference between the timing of recording inventory transactions under the perpetual and periodic inventory systems? 7. Explain the method of reporting inventory at lower of cost and net realizable value. 8. What is the inventory turnover ratio? What is it designed to measure? 9. How is gross profit calculated? What is the gross profit ratio? What is it designed to measure?