If a company uses the FIFO cost assumption?

Question

, the cost of goods sold for the period will be the same under a perpetual or periodic inventory system?

Answer 1

In light of the questions you are asking I suggest that you read the textbook and/or pay more attention in class.

In this case there is no difference.  I wouldn't call this a trick question, but there is no real relationship between the inventory method and the cost of goods sold.

By the way, the IRS requires that a physical inventory be taken at least once per year.  Therefore, on an annual basis, the perpetual and periodic (physical) inventory methods MUST yield the same results.

If there is a difference it is customary to adjust the perpetual inventory because the assumption is that any difference is due to theft and breakage and that the physical inventory is the more accurate of the two.  

Hope this helps

Jerry-the-bookkeeper