Regarding the Inventory System Used by Small Retailers,which of the Following

question 57

Multiple Choice

Regarding the inventory system used by small retailers,which of the following statements is incorrect?

• A) Some small retailers find it too expensive to invest in a perpetual inventory system.
• B) To be competitive, small retailers must use a perpetual inventory system.
• C) In a periodic inventory system, businesses must obtain a physical count of inventory to determine quantities on hand.
• D) Small retailers can use either the periodic or perpetual inventory system.

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Definitions:

Operating Cost

Operating cost encompasses the expenditures related to the day-to-day functions of a business, including costs for goods sold, administration, and general expenses.

Useful Life

Useful life is the estimated period over which an asset is expected to be usable for its intended purpose, affecting its depreciation or amortization schedules.

Differentiation Value

Refers to the unique benefits or characteristics of a product or service that set it apart from competitors in the eyes of customers.

Value-based Pricing

A pricing strategy where the price of a product or service is set based on the perceived or estimated value it provides to customers, rather than its cost of production.