Under the perpetual system, there are continual updates to either the general ledger or inventory ledger as inventory-related transactions occur. There are a number of other differences between the two systems, which are as follows:Īccounts. Comparing Periodic and Perpetual Inventory Systems The periodic system relies upon an occasional physical count of the inventory to determine the ending inventory balance and the cost of goods sold, while the perpetual system keeps continual track of inventory balances. The more sophisticated of the two is the perpetual system, but it requires much more record keeping to maintain. The periodic and perpetual inventory systems are different methods used to track the quantity of goods on hand.
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