Inventory Systems
For an effective
inventory management, an efficient inventory system should be maintained. Thus the importance of inventory systems
cannot be neglected in the Inventory Management. The two importance types of inventory systems
available are
·
Periodic Inventory Systems.
·
Perpetual Inventory Systems.
·
Just –In-Time Inventory Systems.
Periodic Inventory Systems
In this systems the quantity and value of
inventory is found out only at the end of the accounting period after having a
physical verification of the units in hand.
The cost of materials used or goods sold is
obtained by adding the total of inventory purchased during the period to the
value of the inventory in hand in the beginning of the period and subtracting
the value of inventory at the end of period.In this system the inventory level
is not monitored at all during the time interval between the orders, so it has
advantage of little or no required record keeping. The disadvantage is less control.
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