Under periodic inventory,the company first calculates Cost of sales for the period and then determines what the Ending inventory balance is.

Question

Quizplus · Accepted Answer

Under periodic inventory system, the company determines the Cost of sales at the end of the period by subtracting the ending inventory from the sum of beginning inventory and purchases. Therefore, the ending inventory balance is calculated after cost of sales is determined.

Under Periodic Inventory,the Company First Calculates Cost of Sales for the Period