Question

Which statement is incorrect?

A.Periodic inventory systems provide better control over inventories than perpetual inventory systems.
B.Computers and electronic scanners allow more companies to use a perpetual inventory system. Freight-in is debited to Inventory when a perpetual inventory system is used.
C.Regardless of the inventory system that is used, companies should take a physical inventory count.

Answer 1

Answer: The statement which is incorrect is:

A. Periodic inventory systems provide better control over inventories than perpetual inventory systems.

Explanation: Perpetual inventory system is a method of accounting for inventory that records the sale or purchase of inventory immediately through the use of computerized point-of-sale systems and enterprise asset management software. This provides the use of computer and software so therefore, it is better than the periodic inventory system.