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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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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?
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Asked 10/23/2012 8:58:01 AM
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Asked 10/23/2012 9:03:38 AM
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Asked 10/23/2012 9:08:09 AM
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Asked 10/25/2012 9:23:33 AM
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