The Primary Difference Between a Periodic and Perpetual Inventory System

question 186

Multiple Choice

The primary difference between a periodic and perpetual inventory system is that a periodic system

• A)keeps a record showing the inventory on hand at all time.
• B)provides better control over inventories.
• C)records the cost of the sale on the date the sale is made.
• D)determines the inventory on hand only at the end of the accounting period.

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Definitions:

U.S. Dollars

The official currency of the United States, which is used as a standard monetary unit for various international transactions.

Foreign Trade Zone

A designated location within a country where goods can be imported, stored, and processed without being subject to import duties until they enter the domestic market.

U.S. Customs Territory

Refers to the geographic area where U.S. laws, especially those related to import duties and tariffs, are in full effect.

Duty Rate

The tax imposed on imports and exports, usually calculated as a percentage of the value.