Question

MCQ- The basic rule of a company should follow when conducting a physical inventory count is...

MCQ- The basic rule of a company should follow when conducting a physical inventory count is to count-

a. all merchandise purchased in December only,

b. All merchandise physically present.

c. only that merchandise that the business owns,

d. All merchandise physically present and in transit.

Explain in detail

Business   Accounting   
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Answer #1

Answer : d) all the merchandise physically present and in transit

Explanation : 1.counting the inventory mannualy is called physical inventory count

2.generally physical inventory count is done at the end of the month or quarter or year

3. When counting the inventory, you should count all physically presented merchandise and also consider inventory in transit.

4. You should consider also merchandise transfers from one place to another place

5.you should check all the purchase receipts and issue vochurs

6. It is the process of counting all the physical inventory and inventory in transit mannualy for matching the count with the inventory records

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