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

Perpetual Inventory - Purchases

Financial Accounting

4. Merchandising Operations

Perpetual Inventory - Purchases

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Multiple Choice

Fixed quantity models require perpetual inventory systems. By what name are these models commonly known?

Periodic Review Models

Reorder Point Models

Economic Order Quantity Models

Just-in-Time Models

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Verified step by step guidance

Understand the concept of fixed quantity models: These models are designed to maintain a specific inventory level by reordering stock when it reaches a predetermined point.

Recognize that fixed quantity models require perpetual inventory systems, which continuously track inventory levels in real-time.

Learn the common name for fixed quantity models: They are referred to as 'Reorder Point Models' because they rely on a specific reorder point to trigger replenishment.

Differentiate between other inventory models: For example, 'Periodic Review Models' involve checking inventory at regular intervals, while 'Economic Order Quantity Models' focus on minimizing total inventory costs, and 'Just-in-Time Models' aim to reduce inventory levels by receiving goods only as needed.

Conclude that the correct answer is 'Reorder Point Models' based on the characteristics of fixed quantity models and their reliance on perpetual inventory systems.