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1. ConCept- In what ways does having merchandise inventory impact faithful representation and classification?
2. Why is a physical inventory needed under both the periodic and perpetual inventory systems?
3. Which is the better measure of a company's performance-income from operations or net income?
4. Assume a large shipment of uninsured merchandise to your company is destroyed when the delivery truck has an accident and burns. Would you want the terms to be FOB shipping point or FOB destination?
5. Under the perpetual inventory system, the Merchandise Inventory account is constantly updated. What would cause it to have the wrong balance?
6. Business appliCation- Can a company have a "negative" financing period?
7. Business appliCation- Suppose you sold goods to a company in Europe at a time when the exchange rate for the dollar was declining in relation to the euro. Would you want the European company to pay you in dollars or euros?
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