The periodic inventory system requires updating the inventory account only at the end of the period to reflect the quantity and cost of goods available for sale and the cost of goods sold.

Question

Quizplus · Accepted Answer

In a periodic inventory system, the inventory account is updated only at the end of the period to determine the quantity and cost of goods available for sale and the cost of goods sold. This differs from a perpetual inventory system, where the inventory account is updated continuously as purchases and sales occur.

The Periodic Inventory System Requires Updating the Inventory Account Only