perpetual

Accounting

(adjective)

Continuing uninterrupted

Related Terms

  • breakage
  • periodic inventory system
Art History

(adjective)

Lasting forever, or for an indefinitely long time

Examples of perpetual in the following topics:

  • Calculating Perpetuities

    • Perpetuities are a special type of annuity; a perpetuity is an annuity that has no end, or a stream of cash payments that continues forever.
    • There aren't many actual perpetuities, but the United Kingdom has issued them in the past.
    • To find the FV of a perpetuity would require setting a number of periods which would mean that the perpetuity up to that point can be treated as an ordinary annuity.
    • There is, however, a PV formula for perpetuities .
    • The PV of a growing perpetuity is represented as $PVGP \ = \ {A \over ( i - g )}$ .
  • Perpetual vs. Periodic Counting

    • Perpetual inventory updates the quantities continuously and periodic inventory updates the amount only at specific times, such as year end.
    • Perpetual inventory, also called continuous inventory, is when information about amount and availability of a product is updated continuously.
    • A company using the perpetual inventory system would have a book inventory that is exactly (within a small margin of error) the same as the physical (real) inventory.
    • Perpetual inventory systems can still be vulnerable to errors due to overstatements (phantom inventory) or understatements (missing inventory) that occurs as a result of theft, breakage, scanning errors, or untracked inventory movements.
    • While the perpetual inventory method provides a close picture of the true inventory information, it is a good idea for companies using a perpetual inventory system to do a physical inventory periodically.
  • Calculating Annuities

    • Perpetuities: payments continue forever .
    • Perpetuities don't have a FV because they don't have an end date.
    • To find the FV of a perpetuity at a certain point, treat the annuity up to that point as one of the other two types.
    • The PV of a perpetuity is the payment size divided by the interest rate:
    • It is just a matter of when the first and last payments occur (or the size of the payments for perpetuities).
  • Reporting Inventories

    • There are ways to account for inventory, periodic and perpetual.
    • The perpetual inventory system requires accounting records to show the amount of inventory on hand at all times.
  • LIFO Method

    • LIFO under perpetual inventory procedure: Under this procedure, the inventory composition and balance are updated with each purchase and sale.
    • Applying LIFO on a perpetual basis during the accounting period, results in different ending inventory and cost of goods sold figures than applying LIFO only at year-end using periodic inventory procedure.
    • For this reason, if LIFO is applied on a perpetual basis during the period, special inventory adjustments are sometimes necessary at year-end to take full advantage of using LIFO for tax purposes.
    • Applying LIFO on a perpetual basis during the accounting period, results in different ending inventory and cost of goods sold figures than applying LIFO only at year-end using periodic inventory procedure.
    • For this reason, if LIFO is applied on a perpetual basis during the period, special inventory adjustments are sometimes necessary at year-end to take full advantage of using LIFO for tax purposes.
  • Expected Dividends and Constant Growth

    • The PEG ratio is a special case in the Sum of Perpetuities Method (SPM) equation.
    • Derived from the compound interest formula using the present value of a perpetuity equation, SPM is an alternative to the Gordon Growth Model.
  • The Dynamics of Poverty

    • This perpetuation of deprivation is the cycle of poverty.
    • In this way, inadequate or lack of education can perpetuate poverty.
    • This limits their ability to improve their economic position, again perpetuating poverty.
  • The Production of Electromagnetic Waves

    • Once in motion, the electric and magnetic fields created by a charged particle are self-perpetuating—time-dependent changes in one field (electric or magnetic) produce the other.
  • The Feminist Perspective

    • Feminists view the family as a historical institution that has maintained and perpetuated sexual inequalities.
  • Informal Structure

    • Day-to-day interaction reinforces these values that perpetuate a particular lifestyle and preserve group unity and integrity.
    • Day-to-day interaction reinforces these values that perpetuate a particular lifestyle and preserve group unity and integrity.
    • First, they perpetuate the cultural and social values that the group holds dear.
    • Day-to-day interaction reinforces these values that perpetuate a particular lifestyle and preserve group unity and integrity.
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