A company that makes the following journal entry at the time of purchasing inventory is using which of the following inventory systems?
$$\begin{array} { | l | l | l | }
\hline \text { Dr. Inventory } & \text { xxx } & \
\hline \text { Cr. Accounts Payable } & & \mathrm { xxx } \
\hline
\end{array}$$

Question

A company that makes the following journal entry at the time of purchasing inventory is using which of the following inventory systems? 
$$\begin{array} { | l | l | l | } 
\hline \text { Dr. Inventory } & \text { xxx } & \
\hline \text { Cr. Accounts Payable } & & \mathrm { xxx } \
\hline
\end{array}$$

Quizplus · Accepted Answer

The journal entry directly records the purchase of inventory to the Inventory account, which is characteristic of the perpetual inventory system. This system continuously updates inventory records, including purchases and sales.

A Company That Makes the Following Journal Entry at the Time