Example of periodic inventory procedure, Accounting Basics

Assignment Help:

Q. Example of Periodic inventory procedure?

Periodic inventory procedure Merchandising companies selling small unit value merchandise such like nuts and bolts Christmas cards nails or pencils that haven't computerized their inventory systems often find that the extra costs of record-keeping under perpetual inventory procedure in excess of outweigh the benefits. These merchandising companies regularly use periodic inventory procedure.

Under periodic inventory procedure, companies do not use the Merchandise Inventory account to record each purchase and sale of merchandise. In its place a company corrects the balance in the Merchandise Inventory account as the result of a physical inventory count at the end of the accounting period. As well the company usually doesn't maintain other records showing the exact number of units that must be on hand. Even though periodic inventory procedure reduces record-keeping it as well reduces control over inventory items.


Related Discussions:- Example of periodic inventory procedure

AL MASA a sole trader, AL MASA a sole trader,decided to install a new machi...

AL MASA a sole trader,decided to install a new machine to use

Instalments basis of revenue recognition, Q. Instalments basis of revenue r...

Q. Instalments basis of revenue recognition? When accumulating the selling price of goods sold in monthly or annual instalments and considerable doubt exists as to collectabili

Explain the terms assets and liabilities, Two friends, Joe and Bill, both h...

Two friends, Joe and Bill, both have carpentry skills and decide to go into business as partners together ?tting kitchen cabinets. Joe's uncle has agreed to provide £20,000 of capi

Learning objectives of current ratio, Q. Learning objectives of current rat...

Q. Learning objectives of current ratio? - Analyze the transactions by examining source documents. - Journalize the transactions in the journal. - Post the journal entrie

History of accounng, application/realization in history of accounting

application/realization in history of accounting

Create job cost summary sheet , Question: Artarmon Ltd uses a job-order...

Question: Artarmon Ltd uses a job-order costing system and a predetermined overhead rate based on direct labour cost. Estimated manufacturing overheads for the coming year were

Split common stock 4 to 1 and reduced, Split common stock 4 to 1 and reduce...

Split common stock 4 to 1 and reduced PAR from $80 to $20. After the split there were 600,000 shares.

Effect of transction, example of increase asset, decrease owner equity

example of increase asset, decrease owner equity

the stock market crash , The 2001 Recession: It is November 2001 and the U...

The 2001 Recession: It is November 2001 and the U.S. Stock market has plummeted and the recent September 11th attacks have hurt consumer condence. Businesses have stop hiring and c

Write Your Message!

Captcha
Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd