Which statement is not correct about the periodic inventory system for inventory management?
A)The periodic inventory system keeps continuous information about the amount of inventory on hand.
B)The cost of goods sold is a calculated number under the periodic inventory system.
C)Under both the periodic and perpetual systems, the final amounts reported in financial statements are the same.
D)The perpetual inventory system provides more information to allow an enterprise to better manage its inventories.

Question

Quizplus · Accepted Answer

The statement "The periodic inventory system keeps continuous information about the amount of inventory on hand" is not correct. In fact, the periodic inventory system only updates inventory records periodically, typically at the end of an accounting period, and does not keep continuous information about inventory levels.

Which Statement Is Not Correct About the Periodic Inventory System