Regarding the inventory system used by small retailers,which of the following statements is incorrect?
A) Some small retailers find it too expensive to invest in a perpetual inventory system.
B) To be competitive, small retailers must use a perpetual inventory system.
C) In a periodic inventory system, businesses must obtain a physical count of inventory to determine quantities on hand.
D) Small retailers can use either the periodic or perpetual inventory system.

Question

Quizplus · Accepted Answer

While a perpetual inventory system can provide some advantages in terms of accuracy and efficiency, small retailers are not necessarily required to use it to be competitive. Some may find it too expensive to implement, particularly if they have a lower volume of inventory or a limited budget for technology. Both periodic and perpetual inventory systems have their pros and cons, and the choice depends on the specific needs and resources of the business. However, statement B implies that a perpetual inventory system is a requirement for small retailers to be competitive, which is not necessarily true.

Regarding the Inventory System Used by Small Retailers,which of the Following