FIN621 - Financial Statement Analysis GDB Solution

ABC Company is a high-volume retailer. The company is selling many types of low-cost products, even several thousands items per hour. It is using point-of-sale terminals and bar-coded merchandise. What do you think the ABC Company is using which type of inventory system? Also justify your answer.

Answer............



Obviously the ABC Company used perpetual inventory system. Because the large retailer need to record the sales and inventory at every activity and update with after each sale so this system is facilitate the retailer to maintain their record instantly. The computer equipments (POS and Bar coded) they are using is give more facility to check out the customer faster and reliable.

Some characteristics are as under,

Perpetual inventory system updates inventory accounts after each purchase or sale.

*Inventory subsidiary ledger is updated after each transaction.
*Inventory quantities are updated continuously.


Note:Please don't copy erectly this is a guideline thats clear your concept.