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Economic Substance
A accounting concept that transactions must have a genuine economic impact beyond the mere legal form, determining their treatment for tax purposes.
Perpetual Inventory System
This is an inventory accounting system where updates are made continuously to the inventory accounts and cost of goods sold as transactions occur, providing real-time inventory information.
Stockouts
A situation in inventory management when the demand or requirement for an item cannot be fulfilled from the current inventory or stock.
Periodic Systems
An inventory system where inventory counts and cost of goods sold calculations are conducted at specific intervals, such as monthly or yearly.
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