BU127 Lecture Notes - Lecture 11: Uptodate
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BU127 Full Course Notes
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Document Summary
Roles of the accounting system: provides accurate information, provides up-to-date information, provides information to help protect assets. Primary goals of inventory management: provide sufficient quantities of high quality inventory o minimize the costs of carrying inventory. Inventory tangible property held for sale in the normal course of business or used in producing goods or service for sale o merchandisers. Work in process inventory finished goods inventory. The cost principle requires that inventory be recorded at the price paid or the consideration given. Include all costs incurred to bring the asset to useable or saleable condition: invoice price, freight, preparation costs o inspection costs. Beginning inventory + purchase = goods available for sale goods available for sale ending. Perpetual system: provides up-to-date inventory records, provides up-to-date cost of sales records. In a periodic inventory system, ending inventory and cost of sales are determined at the end of the accounting period based on a physical account.
