Possible Reasons for a Business Estimating the Value of the Ending

question 91

Multiple Choice

Possible reasons for a business estimating the value of the ending inventory should include:

• A)the inventory is destroyed by fire.
• B)the business uses periodic system and needs to prepare interim financial statements.
• C)the business uses perpetual system so a physical inventory is never needed.
• D)Both A and B are correct.

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Definitions:

UCC

The Uniform Commercial Code, a comprehensive set of statutes designed to provide uniformity and predictability in commercial transactions across the United States.

Promissory Estoppel

A legal principle that prevents a party from withdrawing a promise made when the other party has reasonably relied on that promise to their detriment.

Consideration

A fundamental component in contract law, referring to something of value that is exchanged between parties as part of an agreement.

Inventor

An individual who creates something new, whether it is an idea for a product, a device, or a process.