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Description: 2)what is the perpetual and periodic inventory systems? 3) What adjusting entries are posted for a retailer that differ from those of service business?

Business

Accounting

what is the perpetual and periodic inventory systems?

College Accounting (Book Only): A Career Approach

13th Edition

ISBN:9781337280570

Author:Scott, Cathy J.

Publisher:Scott, Cathy J.

Chapter9: Sales And Purchases

Section: Chapter Questions

Problem 9QY: Under the perpetual inventory system, how does the seller record sales made on account?

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Similar questions

Which of the following describes features of a perpetual inventory system? A. Technology is normally used to record inventory changes. B. Merchandise bought is recorded as purchases. C. An adjusting journal entry is required at year end, to match physical counts to the asset account. D. Inventory is updated at the end of the period.
Why is it necessary to adjust the Merchandise Inventory account under a periodic inventory system?
Using the perpetual inventory system, what account is debited when a business finds that its physical count of inventory is greater than the recorded amount?
Under the perpetual inventory system, how does the seller record sales made on account?
This type of inventory system does not require an entry to Merchandise Inventory until a physical inventory has been taken. a. Periodic inventory system b. Perpetual inventory system c. Merchandise inventory system d. Beginning inventory system e. Ending inventory system
What is the difference in reporting requirements for customer-returned merchandise in sellable condition under a perpetual inventory system versus a periodic inventory system?
Rules of debit and credit for periodic inventory accounts Complete the following table by indicating for A through G whether the proper answer is debit or credit:
Which of the following is true about the Sales Returns and Allowances account? a. It is used to record the sale of merchandise. b. It is used to record the reduction of inventory. c. It is a contra account, deducted from sales. d. It is used to record discounts for prompt payment. e. None of the above.
Which of the following accounts are used when recording a purchase using a periodic inventory system? A. cash, purchases B. accounts payable, sales C. accounts payable, accounts receivable D. cash, merchandise inventory
Under the periodic inventory system, the ending inventory is entered by debiting Merchandise Inventory and crediting Income Summary.
How long does it take an inventory error affecting ending inventory to correct itself in the financial statements? Explain.
Assume that the business in Exercise 6-9 maintains a perpetual inventory system. Determine the cost of goods sold for each sale and the inventory balance after each sale, assuming the first-in, first-out method. Present the data in the form illustrated in Exhibit 3.