1. a) Compare the periodic versus the perpetual system as a control device. (4 marks) XXXXXXXXXXb)...

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1. a) Compare the periodic versus the perpetual system as a control device. (4 marks)
XXXXXXXXXXb) What sort of organisations are likely to use the periodic inventory system? What kind of XXXXXXXXXXorganisations will prefer to use perpetual inventory system? (3 marks)
c) If management overstated the valuation of inventory, would it affect profit for the year? (3 marks)

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Chirag · Accepted Answer

a) Compare the periodic versus the perpetual system as a control device. (4 marks)
Answer:
The periodic inventory system uses an occasional physical count to measure the level of inventory and the cost of goods sold. The inventory account and the cost of goods sold account are updated at the end of a set period-this could be a month, a quarter, or once a year.
The perpetual system keeps track of inventory balances continuously, with updates made automatically whenever a product is received or sold.

1. a) Compare the periodic versus the perpetual system as a control device. (4 marks) XXXXXXXXXXb) What sort of organisations are likely to use the periodic inventory system? What kind of...

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