Which of the following methods of inventory control will be used in case of a business whose inventory consists of a relatively small number of unique, high-cost items?

Q: What effect does each method used have on the firm’s reportedprofits? On ending inventory levels?

A: Answer: The following is the effect that each method of inventory on firms reported profits:…

Q: Inventory is of great importance to a business.  Explain:     1) why is it important?     2) how is…

A: inventory is of great importance to a business. inventory control systems are important because they…

Q: Why is inventory management important to companies that have inventory?

A: Inventory: It refers to the items held by an organization which were in various forms like raw…

Q: Under what circumstances would a company need to estimate its inventory? What are the differences…

A: The worth of the items in your inventory at the time of your most recent physical count is the…

Q: In what ways would a reduction in inventory help the company

A: Inventory refers to all the items, goods, merchandise, and materials held by a business for selling…

Q: A business using the perpetual inventory system, with its detailed subsidiary records, does not need…

A: The company can maintain its records of inventory on basis of two different systems: 1. Perpetual…

Q: Why does Target feel that the retail inventory method will result in inventory beingvalued at the…

A: LCM (Lower of Cost or Market) approach:   It is an approach that values the inventory at historical…

Q: Which of the following procedure is designed to prevent the company from ordering unnecessary items?…

A: D) Approval of purchase requisitions is the procedure designed to prevent the company from ordering…

Q: What inventory systems do you know are used in a buying and selling business?

A: The inventory systems popularly used are the  1) Perpetual inventory system  2) Periodic inventory…

Q: Why is inventory management especially important for amultinational firm?

A: Inventory Management is significant for Multinational firms. Inventory is generally in the raw…

Q: Planning and regulating inventory use and their associated expenses is the focus of a substantial…

A: When a wholesaler or trader buys items from manufacturers or wholesalers and resells them, this is…

Q: Which of the following statements best explains the relationship between the acquisition/payment…

A: Solution Explanation - Sales collection process is a series of operating events that collectively…

Q: Why would a company choose to use an inventory costing method that estimates the cost of the goods…

A: In this question, we  explain that why would a company choose to use an inventory costing method…

Q: The specific identification inventory method should be used when the inventory consists of…

A: Specific identification inventory method: It is a method used to value the inventory. It calculates…

Q: what are the objectives of eliminating the receiving function. What accounting/audit problems need…

A: Receiving Department:   The receiving department is in obligation of inspection and the receiving…

Q: Which inventory system would allow a business to determine inventory shrinkage (breakage, theft,…

A: Inventory Systems: Inventory systems are classified as periodic or perpetual based on how invetory…

Q: s) Which of the following is NOT a benefit of the Specific Identification method of tracking…

A: The specific identification method represents that the inventory is valued and tracked on an…

Q: Is it necessary to do a physical count of inventory if the company is using a perpetual system?  Why…

A: The perpetual inventory system is one of the approaches or systems used in inventory management…

Q: Why would a "Just in Time" inventory management practice be preferred over a "Just in Case inventory…

A: Just in Time Inventory Management:- It is the inventory technique where labor, material, and other…

Q: Which inventory system would allow a business to determine inventory shrinkage (breakage, theft,…

A: Introduction:- Under Perpetual inventory system tracking of all sales and inventory immediately.…

Q: Describe some inventory control systems that are used in practice

A: Inventory control system: The inventory control system can be defined as the use of a computerized…

Inventory Valuation

Before discussing the topic inventory valuation let’s discuss the meaning of inventory. In accounting, inventory is also known as stock. Inventory means all the finished goods, materials, merchandise that a business holds for the purpose of selling it in the market with the motive of earning profit.