A perpetual inventory system measures cost of goods sold by:

Question

Quizplus · Accepted Answer

In a perpetual inventory system, every purchase and sale of inventory is immediately recorded in the inventory account. This provides a real-time balance for inventory and cost of goods sold, without the need for a physical count at the end of the period or estimating the amount of inventory sold. Therefore, the best choice is B - making entries to the inventory account for each purchase and sale.

A Perpetual Inventory System Measures Cost of Goods Sold By