In addition to the cost-flow assumption,the system used to record movements in inventory also affects the determination of the cost of inventory.What are the systems commonly in use for recording the movement of inventory?
A) continuous and cyclic
B) ABC costing and overhead allocation
C) positive and periodic
D) periodic and perpetual

Question

Quizplus · Accepted Answer

The systems commonly in use for recording the movement of inventory are periodic and perpetual. Periodic inventory system updates the inventory balance only at the end of a specific period, while perpetual inventory system updates the inventory balance continuously in real-time. The choice between the two depends on the nature and size of the business, but perpetual inventory system provides a more accurate and efficient method of tracking inventory movements and determining the cost of inventory. Therefore, the better choice is the periodic and perpetual inventory system.

In Addition to the Cost-Flow Assumption,the System Used to Record