Perpetual and Periodic Inventory System | The Easy Way
Perpetual and Periodic Inventory Systems | The easy way because both systems give the same cost of goods sold ending balance. Whether a business entity uses the perpetual or periodic system, both systems will arrive at the same cost of goods sold.
Perpetual Inventory System uses only one account which is merchandise inventory in all kinds of inventory transactions. On the other hand, the periodic system uses different accounts for every transaction. The periodic system doesn't record the cost of goods sold at the time of sale but tricky how both systems will arrive at the same ending balance regardless of the procedures. That's what this video will teach you, the procedures of the perpetual and periodic inventory system. And the journal entries of each system.
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