Periodic inventory system and perpetual inventory system

July 2022 | 13 pages | ID: P5152B1C59BEN
Sadia Saeed

Abstracts

For attaining the success and development, the companies are required to implement an excellent system for managing all resources. The inventory management is an imperative function in all companies because it pays vital role in the success of the company. Diverse companies use diverse techniques of inventory management on the basis of type of company, nature and environment of the company (Muller, 2011). In this report, the two most important systems such as periodic inventory system and perpetual inventory system will be discussed in detail. The impact of using FIFO and WA on both systems will be highlighted. The nature and requirements of perpetual inventory system and periodic invent system will be discussed. The impact of these two systems on monetary statements and managerial decision making process will be evaluated in the last part of the report. All essential aspects of periodic inventory system and perpetual inventory system will be evaluated in detail in this report. (Continued...) Wordcount of report: 4000 words

Contents

Summary
Introduction
Differences among Perpetual and Periodic system
Stock account and COGS account
Accounts related to purchase
Transaction of sales
Closing entries
Computer systems
Inventory balance
Transaction investigation
Application of Perpetual Inventory System And Periodic Inventory System
Periodic inventory system
Perpetual inventory system
Effect Of Using FIFO And WA
Perpetual Inventory System
Periodic Inventory system
Impact Of Periodic Inventory System And Perpetual Inventory System
Requirements For Both Systems
Conclusion And Recommendations
References