Sales, Purchase and Stock

The meaninig of Sales and Purchase in accounting is a bit different from layman term. Purchase in Accounting means purchase of items with the intention to resale the items for profit. Sales in Accounting means sales of items that purchased with the intention to resale. The keywork here is "to resale". The items that are purchased with the intention to resale to make profit are know as Stock. Those items that purchased but not intended to resale are not considered as Stock.