Control access to inventory records
Insure inventory against loss or damage.
Implement security measures, such as cameras.
Identify the advantages of using a perpetual inventory system.
Determine which of the following statements are correct regarding the difference between
physical flow and the cost flow of goods.
Physical flow is focused on the actual movement of goods.
Cost flow is an assumption about which goods/items are sold
Perishable items must have an actual physical flow of FIFO.
A business may adopt any cost flow assumption when accounting for perishable items.
Demonstrate how inventory costs are treated both as assets and expenses by selecting the
correct statement(s) below.
Inventory items sold are considered part of the cost of goods sold on the income
Inventory items retained at the end of the period are considered part of merchandise
inventory on the balance sheet.
Inventory costs are treated as an expense when they are sold.