11) The two main types of inventory systems are the periodic system and the gross margin method.
12) Under a periodic inventory system, a business maintains a continual record of inventory on hand.
13) When using a perpetual inventory system, a business will debit inventory and credit cost of goods sold each time a sale is recorded.
14) Under a periodic inventory system, cost of goods available for sale is ending inventory plus purchases.
15) A physical inventory count is required under both the perpetual and periodic inventory systems.
16) Historically, periodic inventory systems have been used for low value, high volume items, whereas the perpetual inventory system has been used for high value, low volume items.