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

Cost of Goods Sold - Perpetual Inventory vs. Periodic Inventory

Financial Accounting

4. Merchandising Operations

Cost of Goods Sold - Perpetual Inventory vs. Periodic Inventory

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Multiple Choice

In the context of inventory accounting, the actual quantity is the actual direct material or direct labor used to manufacture the:

cost of goods available for sale

total sales for the year

finished goods during a specific period

ending inventory only

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Verified step by step guidance

Understand the concept of inventory accounting: Inventory accounting involves tracking the costs associated with goods that are manufactured or purchased for resale. It includes direct materials, direct labor, and overhead costs.

Identify the term 'actual quantity': The actual quantity refers to the physical amount of direct materials or direct labor used in the production process during a specific period.

Relate the actual quantity to finished goods: Finished goods are the completed products that are ready for sale. The actual quantity of direct materials and direct labor is used to calculate the cost of manufacturing these finished goods during a specific period.

Clarify the distinction between finished goods and other inventory categories: Finished goods differ from cost of goods available for sale, total sales, and ending inventory. The actual quantity is specifically tied to the production of finished goods, not the broader categories of inventory or sales.

Conclude that the actual quantity is used to determine the cost of finished goods during a specific period, as it directly impacts the manufacturing process and the valuation of completed products.