All the Statements Concerning the Retail Inventory Method of Estimating

question 46

Multiple Choice

All the statements concerning the retail inventory method of estimating closing stock are correct except which of the following?

• A) A stocktake is carried out, valued at retail and then converted to cost by applying the historical gross profit percentage.
• B) The ratio of cost to retail is goods available for sale at cost divided by the goods available for sale at retail.
• C) Differences in the mix of inventory compared to the mix used to determine the cost ratio does not affect the accuracy of the method.
• D) It can be applied with or without a physical stocktake being carried out.

---

Definitions:

Personality Traits

Enduring characteristics and habitual patterns of behavior, thought, and emotion that are relatively stable over time.

Environmental Factors

Elements of the physical and social environment that can influence individuals’ or organizations’ functioning and performance.

Myers-Briggs Type Indicator

A psychological assessment tool that categorizes individuals into 16 different personality types based on preferences in perception and decision-making.

MBTI

Myers-Briggs Type Indicator, a personality assessment tool that categorizes individuals into 16 personality types based on preferences in four dichotomies.