All Else Being Equal, Which of the Following Statements Is

question 82

Multiple Choice

All else being equal, which of the following statements is correct for a company that uses the FIFO costing formula with a perpetual inventory system (compared to a periodic system) ?

• A) The value of the ending inventory would be higher under a periodic system.
• B) The value of the ending inventory would be lower under a periodic system.
• C) The value of the ending inventory would be the same under both systems.
• D) The periodic system would not require any additional entries at the end of the period.

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Definitions:

Adjusted Trial Balance

A list of all accounts and their balances after adjusting entries have been made, used as the basis for preparing financial statements.