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

5. Inventory

Financial Statement Effects of Inventory Costing Methods

Financial Accounting

5. Inventory

Financial Statement Effects of Inventory Costing Methods

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Multiple Choice

All of the following are inventory costing methods used under a periodic inventory system except:

Specific Identification

Weighted Average Perpetual

LIFO (Last-In, First-Out)

FIFO (First-In, First-Out)

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Verified step by step guidance

Understand the context: Inventory costing methods are techniques used to assign costs to inventory and cost of goods sold. These methods are applied under different inventory systems, such as periodic or perpetual systems.

Clarify the difference between periodic and perpetual inventory systems: A periodic inventory system updates inventory records at specific intervals (e.g., monthly or annually), while a perpetual inventory system continuously updates inventory records after each transaction.

Review the inventory costing methods listed: Specific Identification, Weighted Average Perpetual, LIFO (Last-In, First-Out), and FIFO (First-In, First-Out). Note that Weighted Average Perpetual is specific to the perpetual inventory system, not the periodic inventory system.

Identify the correct answer: Since Weighted Average Perpetual is not used under a periodic inventory system, it is the exception among the listed methods.

Conclude that the other methods (Specific Identification, LIFO, and FIFO) are valid inventory costing methods under a periodic inventory system, while Weighted Average Perpetual is not applicable.