Multiple Choice
With a perpetual inventory system, which of the following is true regarding the recording of purchases?
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4. Merchandising Operations
Perpetual Inventory - Purchases
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A system that keeps track of each withdrawal or addition to inventory continuously is called:
A
Just-in-time inventory system
B
Periodic inventory system
C
Specific identification method
D
Perpetual inventory system
Verified step by step guidance1
Understand the question: The problem is asking about a system that continuously tracks inventory withdrawals and additions.
Review the options provided: Just-in-time inventory system, Periodic inventory system, Specific identification method, and Perpetual inventory system.
Clarify the concept of a perpetual inventory system: This system updates inventory records in real-time whenever there is a transaction, such as a sale or purchase, ensuring continuous tracking.
Compare the perpetual inventory system with other options: For example, a periodic inventory system updates inventory records only at specific intervals, not continuously.
Conclude that the perpetual inventory system is the correct answer because it matches the description of continuously tracking inventory changes.
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