Periodic Inventory System Definition:
Periodic inventory system is that does not require a day-to-day record of inventory changes. Costs of materials used and costs of goods sold cannot be calculated until ending inventories, determined by physical count, are subtracted from the sum of opening inventories and purchases (or costs of goods manufactured in the case of a manufacturer).
For calculating the cost of ending inventory, there are several methods available: Last-In, First-Out (LIFO), First-In, First-Out (FIFO), and weighted average.
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