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.

---

Definitions:

One-Stop Shopping

A retail convenience concept where customers can meet all their buying needs in a single location, saving time and effort.

Specialty Outlet

A retail store that focuses on selling a specific category of products or services, often characterized by a high level of expertise and customer service.

Scrambled Merchandise Store

Retail outlets that carry a wide range of products outside of their traditional merchandise lines, expanding their offerings to increase foot traffic and sales.

General Merchandise Store

A retail establishment offering a wide range of products across different categories, typically without a specialty focus.