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Which of the following is true for a perpetual inventory system a

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Which of the following is true for a perpetual inventory
system? a. Costs of inventory purchases are recorded in
the purchases account. b. Ending inventory at the end of
the period is determined by taking a physical inventory
count. c. When a sale is made, cost of goods sold is
debited. d. Cost of goods sold is determined at the end of
the year by subtracting the cost of ending inventory from
the cost of goods available for sale.
Solution
The answer is:
c. When a sale is made, cost of goods sold is debited.
Explanation:
B. Perpetual inventory system. Under this system the
Inventory account is continuously updated. The Inventory
account is increased with the cost of merchandise
purchased from suppliers and it is reduced by the cost of
merchandise that has been sold to customers. (The
Purchases account(s) do not exist.)
Under the perpetual system there is a Cost of Goods Sold
account that is debited at the time of each sale for the cost
of the merchandise that was sold. Under the perpetual
system a sale of merchandise will result in two journal

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Which of the following is true for a perpetual inventory system? a. Costs of inventory purchases are recorded in the purchases account. b. Ending inventory at the end of the period is determined by taking a physical inventory count. c. When a sale is made, cost of goods sold is debited. d. Cost of goods sold is determined at the end of the year by subtracting the cost of ending inventory from the cost of goods available for sale. Solution The answer is: c. When a sale is made, cost of goods sold i s debited. Explanation: B. Perpetual inventory system. Under this system the Inventory account ...
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