Which of the following is the best description of a physical inventory?

A physical inventory is best described as the total number of items physically present. This involves counting all the items in stock at a given time and is essential for ensuring that the records accurately reflect the actual inventory available. Conducting a physical inventory allows businesses to reconcile their accounting records with what they have on hand, helping to identify discrepancies due to theft, damage, or errors in accounting practices.

This process is crucial for accurate financial reporting and inventory management, as it gives a true snapshot of stock levels. Businesses generally conduct physical inventories at regular intervals, like at year-end or quarterly, to verify quantities and maintain accurate records. In contrast, other descriptions such as projected inventory or amounts listed in accounting records refer to estimations or bookkeeping that may not reflect the current physical presence of items.