If a Firm Uses the Periodic Inventory Method,which of the Following

question 48

Multiple Choice

If a firm uses the periodic inventory method,which of the following is subtracted from Purchases to arrive at Net purchases?

• A)Cost of goods available for sale
• B)Ending inventory
• C)Purchase discounts and Purchase returns and allowances
• D)Beginning inventory

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Definitions:

Unrecorded Patent

An unrecorded patent refers to a patent that has been granted but has not been accounted for or reflected in the financial statements of a company.

First-In First-Out

An inventory valuation method where goods first purchased or produced are the first to be sold or used.

Current Rate Method

A technique for converting foreign currency in which all items on the financial statements are translated using the prevailing exchange rate.

Inventory Balance

The total value of all the goods and materials held by a company for resale or production purposes at the end of an accounting period.