Reversing Entries Are an Optional Part of the Accounting Cycle

question 118

True/False

Reversing Entries are an optional part of the accounting cycle.

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Definitions:

Merchandise

Goods that are bought and sold within a retail or wholesale environment, comprising the primary source of revenue for merchandising companies.

Perpetual Inventory System

An approach to inventory accounting that directly records transactions of inventory sales or purchases through the use of computerized point-of-sale and enterprise asset management software.

Gross Method

An accounting method for recording purchases at the gross invoice amount before any trade discounts are deducted.

Merchandise Return

Goods returned to the seller from the buyer, often due to defects, dissatisfaction, or other reasons, impacting revenue and inventory levels.