Explain how the sale of inventory on account is recorded under a periodic system. How does this differ from the recording under a perpetual system?

Q: What is the effect of an entry to record the purchase of inventory on account under the perpetual…

A: Under the perpetual inventory system, purchases are directly debited to the "Inventory account". And…

Q: In a periodic inventory system, the cost of merchandise purchased includes the cost of

A: Statement is TRUE  In a periodic inventory system, the cost of merchandise purchased includes the…

Q: What is inventory shrinkage? Describe the adjusting entry that would be recorded to account for…

A: Inventory shrinkage: When there is a difference between inventory as per books and actual inventory…

Q: What account is debited when recording a purchase of inventory when using the perpetual inventory…

A: Perpetual inventory system: The method or system of maintaining, recording, and adjusting the…

Q: Before inventory purchases are recorded, the receiving report should be reconciled to what…

A: Inventory refers to the raw materials, work-in process, and the finished goods products that are…

Q: Differentiate between perpetual and periodic Inventory system.

A: Under the perpetual inventory system, every single movement of the inventory traces as and when they…

Q: How can we prepare financial statements for a company using periodic inventory system?

A: To calculate or account inventory there is two method, perpetual and periodic inventory method. In…

Q: What is the main distinction between perpetual and periodic inventory systems? Which type of system…

A: Explain the main distinction between perpetual inventory system and periodic inventory system and to…

Q: characteristics of a periodic inventory system, except

A: Characteristics of a periodic inventory system, except (C) INVENTORY RECORD IS ALWAYS UP TO DATE.

Q: What account is debited when recording the payment of freight in when using the periodic inventory…

A: Definition:

Q: Describe the integration of the Inventory Ledger with the Payables, Receivables and General Ledgers.…

A:

Q: What is the difference between a perpetual inventoryand a physical inventory? If a company maintains…

A: Differentiate between a physical inventory system and a perpetual inventory system. Perpetual…

Q: Identify whether each description best applies to a periodic or a perpetual inventory system.…

A: Given description is:  Requires an adjusting entry to record inventory shrinkage.

Q: Explain how a periodic inventory system operates.

A: Inventory: It can be defined as all the goods, items, materials, and merchandise that are held by a…

Q: When using the periodic inventory system, which of the following generally would not be separately…

A: Periodic inventory system: The method or system of recording the transactions related to inventory…

Q: Inventory taken by the owner of the entity for personal use, will affect which of the following…

A: Periodic inventory system is the system of accounting in which inventory is calculated at the end of…

Q: Under the new revenue recognition standard, how is the sale of inventory recorded?

A: Revenue: It refers is the total amount of earnings generated from selling goods or rendering…

Q: Describe in words the journal entries that are made ina perpetual inventory system when inventory is…

A: Perpetual inventory system provides a running balance of cost of goods available for sale and cost…

Q: The two main inventory accounting systems are the Perpetual and periodic. purchase and sale.…

A: Merchandise Inventory: Merchandise is the stock of goods bought by a wholesaler, or a retailer, or a…

Q: When recording purchase returns and purchase allowances under the periodic inventory system, what…

A: Periodic Inventory System:Periodic inventory system is a system in which the inventory is updated…

Q: Explain the types of inventory and the differences between a perpetual inventory system and a…

A:

Q: Based on the information, Determine the adjusted balances of Inventory,Accounts…

A: Adjusted balance can be defined as those amount of balance determined after the closure of books. It…

Q: What account is debited when recording a purchase of inventory when using a periodic inventory…

A: Periodic inventory system: The method or system of recording the transactions related to inventory…

Q: What are the main differences between periodic inventory system and perpetual inventory system?

A: Periodic inventory system and Perpetual inventory systems are two systems used for the inventory…

Q: Please record the entries for the inventory purchase transactions below (Perpetual Inventory System)

A: A Perpetual Inventory system is a method is used for recording inventory balance after each receipt…

Q: Identify whether each description best applies to a periodic or a perpetual inventory system.…

A: Definition: Perpetual inventory: Under the perpetual inventory system, each transaction for the…

Q: Describe the backflushing or post-deduct system of inventory recordkeeping

A: Backflushing is also known as the post-deduct system. When a product is shipped out of stock or used…

Q: Under this inventory system, the “Inventory” account is updated each time a purchase or sale is…

A: Solution: Under perpetual inventory system, inventory is updated with every purchase and sale. Cost…

Q: under the system the ending inventory and cost of goods sold are determined at the end of the…

A: Inventory in the business can be maintained through perpetual inventory system or periodic inventory…

Q: Under a perpetual inventory system, acquisition of inventory is dented to the purchases account.…

A: Under the perpetual inventory system, Inventory transection is charged through the merchandise…

Q: In the periodic inventory system, all purchases of merchandise during the period is recorded on what…

A: There are two type of inventory systems in the business. One is perpetual inventory system and other…

Q: What is the main difference between a perpetual inventory system and a periodic inventory system?

A: Periodic inventory system: The method or system of recording the transactions related to inventory…

Q: Under the perpetual inventory system, in addition to making the entry to record a sale, a company…

A: In Perpetual inventory system, inventory gets updated on real time basis which means inventories are…

Q: Briefly contrast the accounting procedures in perpetual andperiodic inventory systems.

A: Following are the differences between accounting procedures in perpetual and periodic inventory…

Q: A purchase order establishes an initial record of the receipt of the inventory. O True O False

A: A purchase order or PO refers to a commercial document officially issued by the buyer to a seller…

Q: Prepare journal entries to record the transactions, assuming perpetual inventory system.

A: Journal Entries: are the first recording of any transaction in the books of accounts. These entries…

Q: Under which type of inventory system is an inventory sub-sidiary ledger maintained?

A: Inventory subsidiary ledger is a ledger or account that is used to record all inventory related…

Q: Differentiate between perpetual and periodic Inventory system.

A: Perpetual inventory system refers to the method of inventory management which records the real-time…

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.