Coupon Accepted Successfully!


Distinction between Periodic Inventory and Perpetual Inventory System


Basis of Distinction

Periodic Inven­tory System

Perpetual Inventory

1.  Basis of Ascertaining

Inventory is ascer­tained by Inven­tory taking an actual physical count

Inventory is ascertained on the basis of records.

2.  Calculation of Inventory


Inventory is directly calculated by app­lying the met­hod of val­uation of Inven­tories                  

Inventory is calculated as a residual figure as under valuation of Closing Inventory = Opening Inventory + Purchases - Cost of Goods Sold.

3.  Calculation of COGS

COGS is calcu­lated as residual figure as un­der:  the method of valu­ation of COGS = Opening Inventory + Purchases -Closing Inven­tory

Cost of Goods Sold is directly calculated by applying of inventories.


4.  Lost Goods

Cost of Goods sold includes lost goods (if any)

Inventory includes lost goods (in any)

5.  Continuous Stock 

6.  Checking

It does not facilitate the continuous stock checking

It facilitates the continuous stock checking.


7.  Simplicity and cost

It is simple and inex­pensive                                    

It is elaborate and expensive.


8.  Closing Down of work for Stock taking.

It requires closing down of work for stock taking.

It does not require closing down of work for Stock taking.


Test Your Skills Now!
Take a Quiz now
Reviewer Name