How do the inventory systems compare
Comparison of Periodic inventory system and perpetual inventory system:
1. Under the perpetual inventory system inventory is traced at every single movement and recorded in the books but Under a periodic inventory system inventory is valued or updated at end of the period.
2. Also under the perpetual inventory system inventory valuation can be known by checking records as it is recorded at every level but in the periodic inventory system, valuation can be done by physical verification for which other business operations should be stopped.
3. There is more possibility of control under the perpetual inventory system compared to the periodic inventory system.
There fore perpetual inventory system is more advantageous than a periodic inventory system.
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