If a company does not update the inventory and cost of goods sold accounts during the period, it means company is using:

Question

Quizplus · Accepted Answer

The periodic inventory system updates the inventory and cost of goods sold accounts only at the end of the accounting period. In contrast, the perpetual inventory system updates these accounts continuously as inventory transactions occur. Therefore, if a company does not update these accounts during the period, it indicates that it is using the periodic inventory system.

If a Company Does Not Update the Inventory and Cost