In a Periodic Inventory System ________

question 241

Multiple Choice

In a periodic inventory system ________.

• A) quantities of merchandise inventory on hand are updated after each sale and each purchase
• B) the cost to invest in the system is greater than the cost to invest in a perpetual inventory system
• C) the business is in violation of U.S. GAAP
• D) businesses must obtain a physical count of inventory to determine quantities on hand

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Definitions:

Aggregate Plans

Aggregate plans are company-wide plans that are laid out for production, inventory levels, and workforce size to meet fluctuating demand in the most cost-effective manner.

Capacity

Refers to the maximum level of output that a company can sustain to make a product or provide a service.

Inventory

The goods and materials a business holds for the ultimate goal of resale or production.

Backlog Costs

Expenses associated with delays in order fulfillment, including storage, labor, and potential sales loss costs, when demand exceeds production capacity.