When does an inventory error cancel out, and why?

Q: How is the cost of ending inventory determined when pools are used?

A: A LIFO inventory pool is a method under which the individual units having same physical similarities…

Q: what is the cost of its ending inventory at cost? *

A: Retail inventory method refers to an accounting method which is used by the companies to compute the…

Q: Why is it important to obtain shipping and receiving cutoff information during the inventory…

A: Cut-off Procedures:   The audit procedures applied to separate the transactions from one period to…

Q: What is the concept of material inventory error?

A: Raw materials inventory: Raw material inventories are the primary materials which are used in the…

Q: What are characteristics of the perpetual inventory system?

A: Perpetual Inventory System: Perpetual Inventory System refers to the inventory system that maintains…

Q: What is a Perpetual inventory system?

A: Perpetual Inventory System: The perpetual inventory system records and updates the inventory after…

Q: what is FIFO inventory method?

A: FIFO inventory method is one of the methods of calculation of value of ending Inventory and cost of…

Q: How do we record and report inventory shrinkage? Which accounts are affected?

A: Inventory Shrinkage:-When inventory has become less than the actual inventory recorded is known as…

Q: If inventory errors are said to correct themselves, why are accounting users concerned when such…

A:

Q: What is inventory blanket lien?

A: Lien: Lien is a lawful right in contradiction of assets that are usually utilized as security to…

Q: Describe the types of errors in inventory.

A:

Q: Describe Change in Inventory Method and Inventory Errors.

A: Change in Inventory method:   Inventory change is the difference between the amount of last period's…

Q: Vhat is the correct amount of inventory?

A: amount of inventory = FG + cost + goods in process +material + factory supplies

Q: What is inventory conversion period?

A: Conversion period refers to the length of period at which one asset is converted into another form.…

Q: How much should be reported as loss from inventory write-down?

A: New Unit Cost to Sale = Unit Selling price updated - Unit Cost The difference in Profit per Unit =…

Q: What is inventory shrinkage? What are some of the reasons for inventory shrinkage?

A: Inventory Shrinkage :  As the name suggests, it is considered as shrinking or shortening of…

Q: What are the key factors that can lead to an under/overstatement of the inventory balance?

A: Answer: Inventory balances are sometimes overstated and sometimes understated.

Q: Do you agree with the following statements? Express your opinion on each statement.

A: 1: This statement is correct  This can be explained with the help of example: Suppose closing stock…

Q: Which of the following would cause periodic ending inventory to be overstated?

A: Note - the answer has been provided on the basis of information available in question. If any…

Q: Why is it important to periodically take a physical inventory when using a perpetual inventory…

A:

Q: Explain inventory turnover? Can this be too high ever

A: Inventory turnover ratio means the time old inventory is replaced with new inventory with in a year.…

Q: What are the reasons for making an estimate of the value of ending inventory?

A: Inventory- It is the amount of those units which is not sold yet by the entity or the units which…

Q: Are there different methods used to account for perpetual inventory?

A: Perpetual inventory is a continous estimation of the inventory balances based on our books of…

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: Comparing FIFO and LIFO, which one provides the more meaningful measure of ending inventory?

A: FIFO: Under this method, ending inventory is valued at the latest price and Merchandise sold are…

Q: What factors contribute to (or cause) inventory shrinkage?

A: Shrinkage: The cost of the difference between the recorded inventory value and physical count of…

Q: What is the difference between a pull system and a push system of inventory control?

A: In the pull system of inventory control, releases are authorized. And, companies using this strategy…

Q: How does analyzing inventory errors is helpful?

A: Accounting is primarily concerned with identifying, recording, measuring, summarizing transactions…

Q: Provide examples of some procedures that can avoid inventory shrinkage.

A: In the business organization when the situation of inventory lost, theft, or damage occur is known…

Q: Explain the differences between a Perpetual Inventory system and a Periodic Inventory System.…

A: Periodic Inventory System:-  Its an Inventory Valuation Method where inventory account is updated at…

Q: What will be the correct answer for weight average cost method for ending inventory and cost of…

A: Weighted average Cost per unit=11-6×$70+14×$10511-6+14=$182019=$95.79

Q: Explain an example of periodic inventory system.

A: In periodic system the transactions of sales and purchase of inventory is recorded at a certain…

Q: Which of the following is NOT an inventory management technique?

A: Every business unit follows an inventory management process to manage its stock of goods efficiently…

Q: Explain the following statement: “Inventory errors correct themselves.”

A: Solution: Introduction: Inventory means goods are available for sale and raw materials used in the…

Q: What are the origins and fundamental concepts underlying inventory problems? what are they explain…

A: Introduction:- Inventory management is a way of buying, keeping, and selling inventories – both raw…

Q: What can be the effect of inventory errors on the financial reports? How can these errors be…

A: Inventory is the detailed list of items that are present on hand. It constitute of all the finished…

Q: Explain Potential Misstatements- Inventory/ Cost of Goods Sold and the description of misstatements…

A: Internal control is a procedure for insuring that an organization's objectives in operational…

Q: What is the meaning of perpetual or periodic inventory system

A: Normally  the materials purchased for production may not be  fully consumed. There is some quantity…