Table of contents

1. Introduction to Accounting1h 21m
2. Transaction Analysis1h 13m
3. Accrual Accounting Concepts2h 38m
4. Merchandising Operations2h 30m
5. Inventory1h 55m
6. Internal Controls and Reporting Cash1h 16m
7. Receivables and Investments3h 8m
8. Long Lived Assets5h 1m
9. Current Liabilities2h 19m
10. Time Value of Money1h 23m
- Time Value of Money Equations
  35m
- Using Time Value of Money Tables
  47m
11. Long Term Liabilities2h 45m
12. Stockholders' Equity2h 15m
13. Statement of Cash Flows2h 24m
14. Financial Statement Analysis5h 25m
15. GAAP vs IFRS56m

4. Merchandising Operations

Periodic Inventory - Purchases

Financial Accounting

4. Merchandising Operations

Periodic Inventory - Purchases

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Multiple Choice

Which type of inventory system has a higher chance of being inaccurate due to human error?

Perpetual inventory system

Consignment inventory system

Just-in-time inventory system

Periodic inventory system

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Verified step by step guidance

Understand the different types of inventory systems mentioned in the problem: Perpetual, Consignment, Just-in-Time, and Periodic inventory systems.

Recognize that the Periodic inventory system relies on physical counts of inventory at specific intervals, which introduces a higher chance of human error during these manual counts.

Compare this to the Perpetual inventory system, which continuously updates inventory records with each transaction, reducing reliance on manual processes.

Note that Consignment inventory and Just-in-Time inventory systems are specialized methods that focus on inventory ownership and timing, respectively, and are less prone to inaccuracies caused by manual counting.

Conclude that the Periodic inventory system has a higher chance of being inaccurate due to its dependence on manual physical counts, which are susceptible to human error.