Which of the following statements is true?

Question

Quizplus · Accepted Answer

A periodic inventory system involves taking physical inventory at set intervals (e.g. once a month, once a quarter), whereas a perpetual inventory system continuously tracks inventory levels through the use of technology (e.g. barcodes, RFID). Therefore, a perpetual inventory system is typically more expensive to implement and maintain than a periodic inventory system. If a perpetual inventory system is adopted, stock-takes will generally be needed less frequently. Under a perpetual inventory system, records are continuously maintained of items issued from inventory. However, a periodic inventory system does not maintain an up-to-date record of the balance held in inventory, which can lead to inventory discrepancies and inefficiencies. Therefore, option E is the correct statement.

Which of the Following Statements Is True