Unlike the periodic inventory system, the perpetual inventory system:

Question

Quizplus · Accepted Answer

The perpetual inventory system provides a continuous record of inventory on hand, meaning that it tracks the changes in inventory levels on a day-to-day basis. This system uses technology, such as barcodes and RFID tags, to automatically update inventory records whenever a sale or purchase is made, so there is no need for a physical count of the ending inventory. This system is GAAP-compliant and is used by many companies to manage their inventory levels more efficiently. Option A and B are incorrect as they do not fully describe the perpetual inventory system. Option D is also incorrect as the perpetual inventory system is allowed under GAAP.

Unlike the Periodic Inventory System, the Perpetual Inventory System