Small businesses use the periodic inventory method because it:
A) gives instant access to accurate inventory records.
B) records the receipt and sale of each item as it occurs.
C) meets the requirements of local and federal taxing agencies.
D) uses bar codes that are unique to each item of inventory.

Question

Quizplus · Accepted Answer

The periodic inventory method is often used by small businesses because it is less costly and complex than perpetual inventory systems, and it meets basic requirements for financial reporting and tax purposes set by local and federal agencies. It does not provide instant access to accurate inventory records, record each transaction as it occurs, or necessarily use bar codes.

Small Businesses Use the Periodic Inventory Method Because It