Question

Which statement is true about the retail inventory method? Group of answer choices It may not be used to estimate inventories for interim statements. It may not be used to expedite physical inventory counts. It may not be used by auditors. There are different versions of the retail inventory method.

Answer 1

Answer:

The answer is: There are different versions of the retail inventory method.

Explanation:

There are several types of retail inventory method:

1. the conventional (lower of average cost or market) method,
2. the cost method
3. the LIFO retail method
4. the dollar value LIFO retail method

The retail inventory method is very useful for large retailers (e.g. grocery stores, hypermarkets, etc.). Its greatest advantage is that the inventory balance can be calculated without a physical count.