Indicate whether each of the statements that follow is more applicable to a perpetual inventory system, periodic

Question:

Indicate whether each of the statements that follow is more applicable to a perpetual inventory system, periodic inventory system, or both.
1. Inventory figure is not accurate until the date.
2. Requires a physical count of inventory at end of period.
3. No detailed records of the inventory are maintained during the accounting period.
4. Continuous records are kept of the quantity of inventory on hand.
5. Cost of Goods Sold is calculated only at the end of the accounting period.
6. Effective system for managing inventory and thus avoiding running out of stock.
7. Is more costly to maintain but may lead to increased sales.

Balance Sheet
Balance sheet is a statement of the financial position of a business that list all the assets, liabilities, and owner’s equity and shareholder’s equity at a particular point of time. A balance sheet is also called as a “statement of financial...