Use the information below to answer the following question. Pinkerton Ltd uses a perpetual control system for its inventory. It had the following data for a recent period:
If Pinkerton Ltd had employed the periodic inventory method, what would its gross profit have been?
A) $280 000
B) $300 000
C) $320 000
D) $440 000

Question

Use the information below to answer the following question. Pinkerton Ltd uses a perpetual control system for its inventory. It had the following data for a recent period:
 If Pinkerton Ltd had employed the periodic inventory method, what would its gross profit have been?
A) $280 000 
B) $300 000 
C) $320 000 
D) $440 000

Quizplus · Accepted Answer

Since Pinkerton Ltd uses a perpetual control system, its gross profit is determined on a continuous basis. If it had employed the periodic inventory method, it would only calculate its gross profit at the end of the period. Therefore, we cannot determine its gross profit using the information given.

Use the Information Below to Answer the Following Question