Periodic and perpetual methods of FIFO, LIFO, and weighted-average inventories result in different values for ending inventory and the cost of goods sold. Thus, the perpetual variation keeps a continual count of the number and cost of the units in inventory. The perpetual method results in the cost of inventory sold being determined every time an item is sold. This method of applying FIFO, LIFO, and weighted-average is known as a periodic method-the calculation is made only at the end of a period. The cost of the units in ending inventory was determined at the end of a fiscal period. Two variations of each method are also acceptable. The FIFO, LIFO, and weighted-average methods are all recognized methods. Service Revenue and Advertising Expense each have a beginning balance of zero.Generally accepted accounting principles require that a business use a recognized method for determining the cost of merchandise inventory. The beginning balance of each account before the transactions is: Cash, $3,400 Accounts Receivable,$4,200 Supplies, $400 Accounts Payable,$3,500 Deferred Revenue, $300. Post each transaction to T-accounts and compute the ending balance of each account.
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