Indicate Whether Each of the Following Statements Is True or False

question 49

Short Answer

Indicate whether each of the following statements is true or false.
_____ a)The perpetual inventory method recognizes inventory transactions as they occur.
_____ b)The periodic inventory method recognizes sales revenue at the end of the accounting period.
_____ c)A physical count of inventory at the end of each accounting period is necessary for the periodic inventory system,as well as for the perpetual inventory system.
_____ d)A periodic inventory system requires more detailed record keeping than a perpetual inventory system.
_____ e)With a periodic inventory system,cost of goods sold is not determined until the end of the accounting period.

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Definitions:

Sales Growth Rate

The percentage increase in sales over a specific period, indicating the health and expanding nature of a business.

Capacity

The maximum amount that something can contain or produce, often used in the context of production and manufacturing.

Lumpy Assets

Those assets that cannot be acquired smoothly, and that require large, discrete additions. For example, an electric utility that is operating at full capacity cannot add a small amount of generating capacity, at least not economically.

Financial Forecasting

The process of estimating or predicting how a business will perform in the future through the use of historical data and other information.