Question

You have completed your physical count of inventory and determined the ending balance to be $362,000. Your company uses a perpetual inventory system and you are not sure if your inventory records are correct. What will you do in this situation?

Answer 1

To verify the accuracy of your inventory records after completing a physical count and finding an ending balance of $362,000, compare the physical count to the recorded count, check for errors, perform a recount if necessary, trace transactions, and seek professional help if needed.

Step-by-step explanation:

If you have completed your physical count of inventory and determined that the ending balance is $362,000, but you are unsure if your inventory records are correct, there are a few steps you can take to verify the accuracy of your inventory records.

1. Compare the physical count to the recorded count: Compare your physical count of inventory to the recorded count in your inventory records. If there are significant differences, you may need to investigate further.
2. Check for errors: Review your inventory records for any errors or discrepancies such as duplicate entries, missing items, or inaccurate data.
3. Perform a recount: If you suspect errors in your inventory records, it may be helpful to perform a recount to ensure accuracy.
4. Trace transactions: Trace the transactions related to inventory in your accounting system to ensure that they have been properly recorded.
5. Seek professional help if necessary: If you are still unsure about the accuracy of your inventory records, it may be beneficial to consult with a professional accountant or auditor who can help you analyze your inventory records and identify any potential issues.