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

Which of the following is something that carrying inventory allows a company to do?

Guarantee that all inventory will be sold at a profit

Meet customer demand promptly by having products available for sale

Eliminate the need for inventory tracking systems

Avoid all storage and holding costs

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Verified step by step guidance

Understand the concept of carrying inventory: Carrying inventory refers to the practice of maintaining a stock of goods or products that a company can sell to customers. This ensures that the company can meet customer demand promptly.

Analyze the options provided in the question: Evaluate each statement to determine its validity in relation to the purpose of carrying inventory.

Option 1: 'Guarantee that all inventory will be sold at a profit' - This is incorrect because carrying inventory does not guarantee profitability. Profit depends on factors like pricing, demand, and market conditions.

Option 2: 'Meet customer demand promptly by having products available for sale' - This is correct because carrying inventory ensures that products are readily available to meet customer needs without delays.

Option 3: 'Eliminate the need for inventory tracking systems' and Option 4: 'Avoid all storage and holding costs' - Both are incorrect because carrying inventory requires tracking systems to manage stock levels and incurs storage and holding costs.