Which of the Following Does Not Correctly Describe a Perpetual

question 73

Multiple Choice

Which of the following does not correctly describe a perpetual inventory accounting system?

• A)In a perpetual system cost of goods sold are calculated every time a sale is made.
• B)In a perpetual system, assuming shrinkage of zero, inventory and cost of goods sold do not have to be updated at the end of the period.
• C)The use of this system eliminates the requirement for an annual physical inventory
• D)In a perpetual system, assuming a FIFO cost flow, the cost of goods sold would equal those from a periodic system

---

Definitions:

Predictive Validity

The extent to which a score on a scale or test predicts future performance on a related outcome.

Cohen's Kappa

A statistical measure used to evaluate interrater reliability for qualitative (categorical) items, indicating how much agreement is beyond what is expected by chance.

Interrater Reliability

The degree of agreement or consistency among different raters or observers assessing the same phenomenon.

Predictive Validity

Refers to the extent to which a score on a scale or test predicts future performance or outcomes on a related measure.