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What are the journal entries a merchandising organization would use to record the purchase and subsequent sale of merchandise? How would these transactions differ with a periodic versus a perpetual
inventory system?
Stores that use periodic inventory accounting update their inventory balances periodically. [ [ This inventory method has been used before the introduction of point-of-sales scanners and inventory systems, in which stores found it easier to update their inventory balances periodically instead of trying to account for every item sold on a daily basis. Perpetual inventory accounting, on the
other hand, records EACH sale of merchandise and places an entry in the company's inventory account. The introduction of point-of-sale systems and computers greatly advanced the use of the the perpetual inventory system. This system also immediately reduces sold inventory from stock and adds inventory back to stock when a customer returns merchandise. ] ]
Expert answered|kraju|Points 30|
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Asked 10/30/2012 9:13:06 AM
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What are the steps in completing the accounting cycle? How do the different steps affect the financial statements? What is the effect on the financial statements of missing a step when completing the accounting cycle?
Weegy: It would depend on which step you miss. [ If you fail to make year end adjusting entries, your inventory account will probably be over-stated, supplies expenses may be over-stated if supplies are expensed directly, accumulated depreciation will be under-stated, and so on and on... there is no way to tell from the the information given in your question. ] (More)
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Asked 10/23/2012 8:56:16 AM
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What are the steps in completing the accounting cycle? How do the different steps affect the financial statements? What is the effect on the financial statements of missing a step when completing the accounting cycle?
Weegy: steps in the accounting cycle: 1. Identify the transaction and find locate its source document. 2. Record the transaction in the general journal and related journals. 3. Post transactions to the ledger accounts. 4. Prepare the trial balance. 5. [ Make sure the trial balance totals are equal. 6. Prepare any adjusting entries in the trial balance. 7. Create an adjusted trial balance. 8. Create your financial statements. 9. ... (More)
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Asked 10/23/2012 8:58:01 AM
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What are the steps in completing the accounting cycle?
Weegy: The answer are, Transactions, Journal entries, Posting, Trial balance, Worksheet, Adjusting journal entries, Financial statements and Closing the books. the steps in completing the accounting cycle are Transactions, Journal entries, Posting, [ Trial balance, Worksheet, Adjusting journal entries, Financial statements and Closing the books. ] (More)
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Asked 10/23/2012 9:03:38 AM
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What are the pros and cons of using reversing entries? Why are reversing entries optional?
Weegy: Reversing Entries An entry that requires reversing includes amounts entered into the accounting system to allocate expenses that span two accounting periods. [ For instance, if an invoice for an interest-only loan payment is due each month on the 15th, only one-half of the entry applies to the current month, while the other half of the entry applies to the next month. To accommodate this transaction, the accountant would expense half of ... (More)
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Asked 10/23/2012 9:08:09 AM
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Weegy: Commercial accounting and generally accepted accounting principles, generally prescribe the accrual basis of accounting over the cash basis. [ Describe both bases of accounting and explain the differences. Cash basis is used mostly by small businesses where owners and creditors want a simple way to understand the financial statements. Cash basis is used when a company or creditors does not worry about the accuracy of the ... (More)
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