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For the purpose of determining the value of its end-of-year inventory, a clothing store creates a list at the end of the year of every item currently in stock along with each iter's wholesale price. Which of the
For the purpose of determining the value of its end-of-year inventory, a clothing store creates a list at the end of the year of every item currently in stock along with each iter's wholesale price. Which of thefollowing is the best description of the end-of-the-year activity?
Final answer:Inventory valuation is the process where a business determines the value of their inventory at a specific period's end. In this case, the clothing store uses the wholesale price of each item in the inventory count. The process provides sales velocity, consumer demand, and profit from potential sales insights.Explanation:The end-of-year activity described in the student's question is known as aninventory valuation. This is a process by which businesses estimate the value of their inventory at the end of a particular period, in this case, a year. The value of inventory is critical for determining a company's net profit or loss, as unsold inventory is considered an asset. The clothing store is using the wholesale price of each item to evaluate its inventory. This practice allows businesses to keep track of what merchandise they have on hand and what it's valued at, revealing financial insights into sales velocity, consumer demand, and possible income from potential sales.Retailerstypically conduct an annual count to confirm the inventory numbers and to ensure the physical count aligns with the numbers on their books.Learn more about Inventory Valuation here:brainly.com/question/33722424#SPJ11...