hich of the following statements relative to book (perpetual) inventory systems Is false? a. Use of book inventory system allows a retailer to know at all times the value of inventory on hand without having to take a physical inventory. b. Book inventory systems can be maintained on either a retail dollar or a cost dollar basis. c. Cost dollar control is used more in retailing than retail dollar control. d. A cost dollar control system is used when merchandise is of an unusually high unit value and there are relatively few transactions. e. When using a cost system, it is not possible to record additional markups and reductions because all the figures in the cost system are in cost dollars.

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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.