Asked by Lasha Petree on May 23, 2024
Verified
A periodic inventory system is preferable if avoiding "stock-outs" is of paramount importance-for example in manufacturing firms that use just-in-time systems.
Just-In-Time Systems
Inventory management systems that produce or provide items exactly when needed, minimizing inventory costs.
Stock-Outs
Stock-outs occur when an item is no longer available for sale, typically because inventory levels have been depleted.
Periodic Inventory System
A method of inventory valuation where inventory counts and cost of goods sold calculations are made periodically at the end of a reporting period, instead of after each sale.
- Learn about the operational divergences between periodic and perpetual inventory systems.
Verified Answer
Learning Objectives
- Learn about the operational divergences between periodic and perpetual inventory systems.
Related questions
Periodic Inventory Systems Provide a Greater Degree of Management Control ...
A Periodic System of Inventory Is Used When Inventory Volumes ...
The Primary Difference Between the Periodic and Perpetual Inventory Systems ...
Under a Perpetual Inventory System Inventory Shrinkage and Lost or ...
If a Company Determines Cost of Goods Sold Each Time ...