The Perpetual Method of Accounting for Inventory

question 94

Multiple Choice

The perpetual method of accounting for inventory

• A) Requires that a physical count of inventory be taken before the cost of goods sold can be determined with any reasonable degree of accuracy
• B) Is likely to be less expensive to maintain than a periodic inventory method
• C) Is not as helpful as a periodic method in providing management with timely reports about inventory quantities and costs
• D) Allows management to better estimate inventory losses from pilferage than does a periodic inventory method

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