The system of accounting for inventory that involves keeping a current and continuous record of the movement in each item of inventory is known as the ____________ inventory system.

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The perpetual inventory system involves keeping a continuous record of the movement in each item of inventory, including the cost of goods sold and current inventory balance. This is in contrast to the periodic inventory system, which only updates inventory records periodically (usually at the end of each accounting period). The accrual and physical inventory systems are unrelated to record-keeping and instead refer to the method of accounting for inventory costs (accrual) and the process of physically counting inventory (physical).

The System of Accounting for Inventory That Involves Keeping a Current