Management has the choice of physically counting inventory on hand at the end of the year or using the gross profit method to estimate the ending inventory.

Name: Management has the choice of physically counting inventory on hand at the end of the year or using the gross profit method to estimate the ending inventory.
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Question

Quizplus · Accepted Answer

The gross profit method is not a substitute for a physical inventory count; it is an estimation technique used for interim financial statements or when a physical count is not feasible.

Management Has the Choice of Physically Counting Inventory on Hand