Which of the following inventory systems uses an adjusting entry to record the cost of sales?
A)Periodic system
B)Perpetual system
C)Just-in-time system
D)No system uses an adjusting entry to record the cost of sales.

Question

Quizplus · Accepted Answer

In a periodic inventory system, the cost of goods sold is recorded through an adjusting entry at the end of the period based on physical inventory counts. In contrast, a perpetual system continuously updates the cost of goods sold with each sale transaction and does not require an adjusting entry. Just-in-time systems do not rely on traditional inventory tracking methods and may not even have a formal record of the cost of sales.

Which of the Following Inventory Systems Uses an Adjusting Entry