Perpetual Inventory System: Perpetual Inventory System refers to the inventory system that maintains the detailed records of every inventory transactions related to purchases and sales on a continuous basis. It shows the exact on-hand-inventory at any point of time. Periodic Inventory System: It is a system in which the inventory is updated in the accounting records on a periodic basis such as at the end of each month, quarter or year. In other words, it is an accounting method which is used to determine the amount of inventory at the end of each accounting period. Inventory cost flow: It refers to the flow (movement) of inventory when it is purchased or sell by the business organization. The various inventory cost flow methods are: First-in, first-out (FIFO) Last in, first-out (LIFO) Average-cost To explain: The given statement is true or not.

Question

Want to see the full answer?

Answer 1

Question

Chapter 6, Problem 20Q

To determine

Perpetual Inventory System: Perpetual Inventory System refers to the inventory system that maintains the detailed records of every inventory transactions related to purchases and sales on a continuous basis. It shows the exact on-hand-inventory at any point of time.

Periodic Inventory System: It is a system in which the inventory is updated in the accounting records on a periodic basis such as at the end of each month, quarter or year. In other words, it is an accounting method which is used to determine the amount of inventory at the end of each accounting period.

Inventory cost flow: It refers to the flow (movement) of inventory when it is purchased or sell by the business organization.

The various inventory cost flow methods are:

First-in, first-out (FIFO)

Last in, first-out (LIFO)

Average-cost

To explain: The given statement is true or not.

Expert Solution & Answer

Want to see the full answer?

Check out a sample textbook solution

See solution

Students have asked these similar questions

Jesse Brimhall is single. In 2024, his itemized deductions were $12,000 before considering any real property taxes he paid during the year. Jesse's adjusted gross income was $70,000 (also before considering any property tax deductions). In 2024, he paid real property taxes of $3,000 on property 1 and $1,200 of real property taxes on property 2. He did not pay any other deductible taxes during the year. If property 1 is Jesse's business building (he owns the property) and property 2 is his primary residence, what is his taxable income after taking property taxes into account (ignore the deduction for qualified business income)?

Sarah (single) purchased a home on January 1, 2008, for $600,000. She eventually sold the home for $800,000. What amount of the $200,000 gain on the sale does Sarah recognize in each of the following alternative situations? (Assume accumulated depreciation on the home is $0 at the time of the sale.) Sarah used the property as a vacation home through December 31, 2021. She then used the home as her principal residence from January 1, 2022, until she sold it on January 1, 2025.

All of the following are reasons why IT is important to accountants except: a.IT questions often appear on professional certification examinations b.The costs of IT are skyrocketing c.Accountants often help clients make IT decisions d.Auditors must evaluate computerized systems