Regarding a periodic inventory system,which of the following statements is incorrect?
A) The periodic inventory system is normally used for relatively expensive goods.
B) Restaurants and small retail stores normally use the periodic inventory system.
C) Periodic inventory systems are becoming less and less popular.
D) The physical count of inventory is required in order to determine the quantities on hand.

Question

Quizplus · Accepted Answer

The periodic inventory system is typically used for relatively inexpensive goods because the cost of tracking each individual item would outweigh the benefit of more frequent updates to inventory records. Additionally, restaurants and small retail stores are more likely to use the periodic system due to their smaller inventory levels and simpler tracking needs. While some businesses may be transitioning to more automated and frequent inventory tracking systems, the periodic inventory system remains popular for many smaller businesses. Finally, the physical count of inventory is required in order to update inventory records in a periodic system, which is a distinguishing characteristic of this system.

Regarding a Periodic Inventory System,which of the Following Statements Is