Under perpetual inventory procedure, companies have no purchases and purchase-related accounts. Instead, they make all entries involving merchandise purchased for sale to customers directly in the merchandise inventory account. So they debit or credit merchandise inventory in place of debiting or crediting purchase, purchase discount, purchase returns and allowance, and transportations-in. So perpetual inventory procedure is an important element in providing internal control over goods in inventory
what will happen if the inventory tag is misplaced..? what will be the effect to the inventory?
Add the purchases costs in order to achieve something
The inventory costs depend upon the4 methods that maybe used.So which method is acceptable per GAAP?
THAT IS ALOT OF INFORMATION
this pertains to FIFO and LIFO inventory where different costs paid for the similar items.
- Module: Module 2: Measuring and Reporting Inventory - Topic: Determining Inventory Costs
Inventory should be valued at the lower of cost and net realizable value
The inventory costs are determined depending on the quantity and price of the items. Inventory costs include all necessary outlays to obtain the goods and avail them ready for sell in a good desirable location for the customer for example seller's invoice less purchase discounts, cost of buyer's insurance, transport charges and handling costs.
how is carriage inwards and carriage outwards treated in inventory costs and in the income statement?