Under a perpetual inventory system, is it necessary to take a physical inventory at the end of the period? Why or why not? Joan and Pat Clair are sisters who each own and operate shops selling the latest electronics in neighboring towns. They decide to have a contest to see whose shop can be more profitable for the year. At year-end, Joan's records show sales of $210,000, cost of goods sold of $110,000, and operating expenses of $42,000. The records of Pat's shop reveal sales of $216,000, cost of goods sold of $124,000, and operating expenses of $38,000. Pat's shop also had other revenue of $6,000 received for allowing the shop to be used in taping a television show. Each sister claims to have won the contest. Provide explanations as to why each would think so, and then name the winner What is the financing period? Is a longer or shorter financing period most desireable?

FINANCIAL ACCOUNTING
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Chapter1: Financial Statements And Business Decisions
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Under a perpetual inventory system, is it necessary to take a physical inventory at the end of the period? Why or why not?
Joan and Pat Clair are sisters who each own and operate shops selling the latest electronics in neighboring towns. They decide to have a contest to
see whose shop can be more profitable for the year. At year-end, Joan's records show sales of $210,000, cost of goods sold of $110,000, and
operating expenses of $42,000. The records of Pat's shop reveal sales of $216,000, cost of goods sold of $124,000, and operating expenses of
$38,000. Pat's shop also had other revenue of $6,000 received for allowing the shop to be used in taping a television show. Each sister claims to
have won the contest. Provide explanations as to why each would think so, and then name the winner
What is the financing period? Is a longer or shorter financing period most desireable?
Transcribed Image Text:Under a perpetual inventory system, is it necessary to take a physical inventory at the end of the period? Why or why not? Joan and Pat Clair are sisters who each own and operate shops selling the latest electronics in neighboring towns. They decide to have a contest to see whose shop can be more profitable for the year. At year-end, Joan's records show sales of $210,000, cost of goods sold of $110,000, and operating expenses of $42,000. The records of Pat's shop reveal sales of $216,000, cost of goods sold of $124,000, and operating expenses of $38,000. Pat's shop also had other revenue of $6,000 received for allowing the shop to be used in taping a television show. Each sister claims to have won the contest. Provide explanations as to why each would think so, and then name the winner What is the financing period? Is a longer or shorter financing period most desireable?
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