All of the Following Statements Are True Regarding the Periodic

question 74

Multiple Choice

All of the following statements are true regarding the periodic inventory system except

• A)Under the periodic inventory system, the balance of cost of goods sold is calculated at the end of the period.
• B)Under the periodic inventory system, the balance in ending inventory is calculated at the end of the period.
• C)Using the periodic inventory system affects the balance sheet contents differently than when the perpetual system is used.
• D)Under the periodic system, a company uses separate accounts to record freight costs, returns, and discounts.

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Definitions:

Valuation Rate

A rate used to estimate the current value of assets or liabilities for purposes of financial reporting or appraisal.

Market Value

The prevailing rate at which a good or service is available for purchase or sale on the open market.

Market Value

The present rate at which one can buy or sell an asset or service on the open market.

Property Taxes

Taxes assessed on real estate by the local government, calculated as a percentage of the property's value.