When a Company Uses the Perpetual Inventory Method,which of the Following

question 48

Multiple Choice

When a company uses the perpetual inventory method,which of the following would be the entry to adjust inventory to lower-of-cost-or-market?

• A) debit Loss on Inventory and credit Merchandise Inventory
• B) debit Merchandise Inventory and credit Inventory Adjustment
• C) debit Cost of Goods Sold and credit Merchandise Inventory
• D) debit Merchandise Inventory and credit Cost of Goods Sold

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Definitions:

Custom

Custom pertains to traditional practices, habits, or behaviors that are typical to a specific culture, society, or community.

Ideology

An arrangement of beliefs and values, especially one that establishes the groundwork for political or economic theories and strategies.

Cultural System

A complex set of values, beliefs, institutions, and artifacts that define a society and influence behavior and social norms.

Functional Areas

Distinct sectors within an organization or industry that specialize in specific aspects of the business operation, such as marketing, finance, human resources, and research and development.