BU127 Lecture Notes - Lecture 7: Perpetual Inventory, Tangible Property, Finished Good

• School: WLU
• Department: Business
• Course: BU127
• Professor: James Moore

Document Summary

Inventory: tangible property held for sale in the normal course of business or used in producing goods or services for sale, merchandise inventory, raw materials inventory, work in process inventory, finished. The cost principle requires that inventory be recorded at the price paid. Include all costs incurred to bring the asset to useable or saleable condition. Merchandise purchases to merchandise inventory to cost of sales. Nature of cost of sales (cid:1828)(cid:1857)(cid:1859)(cid:1866)(cid:1866)(cid:1866)(cid:1859) (cid:1866)(cid:1874)(cid:1857)(cid:1866)(cid:1872)(cid:1867)(cid:1870)+(cid:1873)(cid:1870)(cid:1855) (cid:1853)(cid:1871)(cid:1857)(cid:1871)=(cid:1867)(cid:1867)(cid:1856)(cid:1871) (cid:1827)(cid:1874)(cid:1853)(cid:1864)(cid:1853)(cid:1854)(cid:1864)(cid:1857) (cid:1858)(cid:1867)(cid:1870) (cid:1845)(cid:1853)(cid:1864)(cid:1857) (cid:1867)(cid:1867)(cid:1856)(cid:1871) (cid:1827)(cid:1874)(cid:1853)(cid:1864)(cid:1853)(cid:1854)(cid:1864)(cid:1857) (cid:1858)(cid:1867)(cid:1870) (cid:1845)(cid:1853)(cid:1864)(cid:1857) (cid:1866)(cid:1856)(cid:1866)(cid:1859) (cid:1866)(cid:1874)(cid:1857)(cid:1866)(cid:1872)(cid:1867)(cid:1870)=(cid:1829)(cid:1867)(cid:1871)(cid:1872) (cid:1867)(cid:1858) (cid:1845)(cid:1853)(cid:1864)(cid:1857)(cid:1871) Separation of inventory accounting and physical handling of inventory. Storage in a manner that protects from theft and damage. Comparing perpetual records to periodic physical counts. Perpetual system: this system keeps up-to-date records of inventory and cost of sales. Periodic system: ending inventory and cost of sales are determined at the end of the period based on a physical count. Cost of goods available for sale cost of goods available for sale.