Chapter 5, Problem 16QS

Contrasting periodic and perpetual systems

Identify whether each description best applies to a periodic or a perpetual inventory system.

______ a. Updates the inventory account only at period-end.

______ b. Requires an adjusting entry to record inventory shrinkage.

______ c. Markedly increased in frequency and popularity in business within the past decade.

______ d. Records cost of goods sold each time a sales transaction occurs.

______ e. Provides more timely information to managers.