Question

Under a periodic inventory system:____________.
1. accounting records continuously disclose the amount of inventory.
2. increases in inventory resulting from purchases are debited to purchases.
3. there is no need ever for a physical count.
4. the account inventory is credited when goods are returned to vendors.

Answer 1

Answer:

1. accounting records continuously disclose the amount of inventory.

Explanation:

The periodic inventory system is the accounting method of calculating the value of inventory at the end of a specified period of time. Under this system, updates are made on a periodic basis rather than after every sale or purchase of inventory. It continuously tracks the record of inventory by physically counting the inventory and the cost of inventory is calculated by using the inventory calculation method, such as FIFO, LIFO, and weighted averages.