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Q. Taking a physical inventory in periodic inventory procedure?
Taking a physical inventory in periodic inventory Procedure Company personnel determine ending inventory cost by taking a physical inventory. Taking a physical inventory consists of counting physical units of every type of merchandise on hand. To compute inventory cost they multiply the number of each kind of merchandise by its unit cost. Then they merge the total costs of the various types of merchandise to provide the total ending inventory cost.
In taking a physical inventory company personnel should be careful to count all goods owned regardless of where they are located and include them in the inventory.
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