Formative Assessment Directions: The following statements pertain to the concepts associated with the accounting merchandising. Write True if the statement is correct, otherwise False on the space provided. 1. Inventory is the most important asset of a merchandising firm. 2. The sales journal can be used to record sales with immediate cash payments. 3. Under the sale term 1/ 10, net 30, the discount is valid until 10 th from the date of purchase. Inventories are assets acquired which are held for sales in the ordinary course of the business. 3. A car dealership has separate inventory records for each vehicle is the example of the Perpetual system. 6. Postings to the ledger shall be made on chronological order. . Adjusting entries should be made before financial statements can be prepared. 8. Sales - FOB = Gross Profit - Operating Exp. = Net Income (LOSS). 9. The entry to close net loss for a corporation involves a credit to retained earnings. 10. Prepaid expenses regardless of which method was used in the adjusting entries can be reversed on the first day of the next accounting period.Performance Check The following data are given for Jimin and Jin Corporation. Beginning Inventory - 6,000 Purchases 102,000 Ending Inventory 8,000 Sales 15,000 units sold at 10 pesos Determine the Gross Profit- IntegrationS w Valuing One of the most fundamental business skills is inventory management. Retailers and wholesalers need to know what products are available for sale. restaurants need to know what ingredients they have on hand, and even office supplies need to be tracked. You can do this by employing a periodic inventory system, which counts your onhand inventory on a regular basis, or by using software to track it in real time. This is referred to as a perpetuul inventory system. Periodic and perpetual inventory systems are two contrasting accounting methods that businesses use to track the number of products they have available. Overall. the perpetual inventory system offers many benefits over the periodic system and is now used by all major retailers. Periodic inventory occounling systems are normally better suited to small businesses due to the expense of acquiring the technology and staff to support a perpetual system. A business, such as a car dealership or art gallery, might be better suited to the periodic system due to the low sales volume and the relative ease of tracking inventory manually. Businesses with high sales volume and multiple retail outlets [like grocery stores or pharmacies] need perpetual inventory systems. The technological aspect of the perpetual inventory system has many advantages such as the ability to more easily identify inventoryerelated errors. The perpetual system can show all transactions comprehensively at the individual unit level. Enrique Eobel Foundation | Senior High School 13 Under the perpetual system, managers are able to make the appropriate timing of purchases with a clear knowledge of the quantity of goods on hand at various locations. Having more accurate tracking of inventory levels also provides a better way of monitoring problems such as theft. POV: Give two examples of companies or businesses that use periodic inventory systems [i each} and perpetual inventory systems {leach}