A Retailer's Physical Count of Inventory Was Higher Than That

question 38

Multiple Choice

A retailer's physical count of inventory was higher than that shown by the perpetual records. Which of the following could explain the difference?

• A)Inventory items had been counted but the tags placed on the items had not been taken off and added to the inventory accumulation sheets.
• B)Credit memos for several items returned by customers had not been recorded.
• C)No journal entry had been made on the retailer's books for several items returned to its suppliers.
• D)An item purchased FOB shipping point had not arrived at the date of the inventory count and had not been reflected in the perpetual records.

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Definitions:

Output Per Hour

A measure of productivity calculated by dividing the total output of goods and services by the total hours worked.

Marginal Productivity

The additional output that is produced by adding one more unit of a particular input while holding all other inputs constant.

Complements In Production

Goods that are produced together or their production levels are directly linked; an increase in the production of one leads to an increase in the production of the other.

Substitute Resources

Alternative inputs or resources that can be used in place of another in the production process.