MANAGEMENT

Detailed explanation-1: -Perpetual inventory is a continuous accounting practice that records inventory changes in real-time, without the need for physical inventory, so the book inventory accurately shows the real stock. Warehouses register perpetual inventory using input devices such as point of sale (POS) systems and scanners.

Detailed explanation-2: -The periodic inventory system uses an occasional physical count to measure the level of inventory and the cost of goods sold. The perpetual system keeps track of inventory balances continuously, with updates made automatically whenever a product is received or sold.

Detailed explanation-3: -Under the perpetual system, two transactions are recorded at the time that the merchandise is sold: (1) the amount of the sale is debited to Accounts Receivable or Cash and is credited to Sales, and (2) the cost of the merchandise sold is debited to the account Cost of Goods Sold and is credited to Inventory.

Detailed explanation-4: -The perpetual inventory system involves tracking and updating inventory records after every transaction of goods received or sold through the use of technology.

Detailed explanation-5: -Perpetual Inventory System Meaning The perpetual inventory system records the stocks continuously. Under the perpetual inventory system, the inventory gets recorded after each issue or receipt or purchase of the raw materials, work in progress, final goods, etc.