Scenario-1: A company to support its working capital requirements approaching a new bank as their existing bank refused to provide a short-term loan against the raw material.
Scenario-2: For one of the products, a company enjoys a steady, continuous demand. The products are sold as soon as it is produced. The company wants to improve its sales department to accurately promise its customers.
Scenario-3: A company due to poor sales and its inability to pay the creditors, it files for bankruptcy. The regulatory body responsible for bankruptcy appoints a liquidator to dispose of the current and fixed assets to repay the creditors.
Scenario-4: An automobile plant working on JIT manufacturing is really concerned about the parts non-availability and the resultant stoppage of its assembly lines.
Question: Which one of the following options is the most appropriate inventory auditing method for each of the scenario 1 through 4?
A) Scenario-1: Perpetual; Scenario-2: Perpetual; Scenario-3: Periodic; Scenario-4: Perpetual
B) Scenario-1: Periodic; Scenario-2: Perpetual; Scenario-3: Periodic; Scenario-4: Perpetual
C) Scenario-1: Periodic; Scenario-2: Periodic; Scenario-3: Periodic; Scenario-4: Perpetual
D) Scenario-1: Periodic; Scenario-2: Perpetual; Scenario-3: Periodic; Scenario-4: Periodic
Answer: Scenario-1: Periodic; Scenario-2: Perpetual; Scenario-3: Periodic; Scenario-4: Perpetual