Which answer is correct? This Question: 5 pts This Quiz: 100 pts possible Which

Question

Which answer is correct?

This Question: 5 pts This Quiz: 100 pts possible Which of the arding a penodik inventory system is incorrect? O A. The various inventory costing methods are not used in a periodic inventory system. O B. The only way to determine the ending inventory and cost of goods sold in a periodic inventory system is to take a physical inventory c. A periodic inventory system is simpler than a perpetual inventory system. O D. A peniodic inventory system works well for small businesses in which inventory costs can be controlled by visual inspection Click to select your answer IFO Vhat does the Total column represent? repare income statements for each of the three methods vil the company pay more or less tax if it uses FIFOrather than LIFO?How much more or

Explanation / Answer

Answer:The various inventory costing methods are not used in a periodic inventory system.

The periodic system relies upon an occasional physical count of the inventory to determine the ending inventory balance and the cost of goods sold, while the perpetual system keeps continual track of inventory balances. The primary case where a periodic system might make sense is when the amount of inventory is very small, and where you can visually review it without any particular need for more detailed inventory records.

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