The two basic approaches to accounting for inventory and thecost of goods sold are the perpetual inventory system and theperiodic inventory system. Indicate which of the followingstatements are correct. (More than one answer may be correct.) a. Most large merchandising companies and manufactur-ing businesses use periodic inventory systems. b. As a practical matter, a grocery store or a large depart-ment store could not maintain a perpetual inventory system without the use of point-of-sale terminals.c. In a periodic inventory system, the cost of goods sold is notdetermined until a complete physical inventory is taken.d. In a perpetual inventory system, the Cost of Goods Soldaccount is debited promptly for the cost of merchandisesold.
The two basic approaches to accounting for inventory and the
cost of goods sold are the perpetual inventory system and the
periodic inventory system. Indicate which of the following
statements are correct. (More than one answer may be correct.)
a. Most large merchandising companies and manufactur-
ing businesses use periodic inventory systems.
b. As a practical matter, a grocery store or a large depart-
ment store could not maintain a perpetual inventory
system without the use of point-of-sale terminals.
c. In a periodic inventory system, the cost of goods sold is not
determined until a complete physical inventory is taken.
d. In a perpetual inventory system, the Cost of Goods Sold
account is debited promptly for the cost of merchandise
sold.
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