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Periodically, for example at each year end, a firm may conduct a stock take to confirm whether the
actual stock agrees with the records. This is done under the periodic stock system. The actual count
might reveal a figure different from that in the records.
This may be due to:
- Incorrect entries in bin-card or ledger accounts
- Items of material placed in working bins
- Theft or breakages
- Mathematical errors in bin –card / ledger
- Issues or receipts of materials not recorded.
- Excess or shortages in items not properly checked on receipt.
- Losses due to evaporation, drying etc.
- Destruction due to climatically conditions.
- Changes in volume due to temperatures.
- Loss due to issue of materials or units in small lots or units (spillage).
- Loss due to accidents.
- Loss due to economic factors e.g. inflation hence currency exchange rates.
marto answered the question on February 26, 2019 at 09:29
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