In which system are inventory updates made on a periodic basis?

The periodic inventory system is characterized by updates to inventory levels that occur at specific intervals, rather than continuously. In this system, inventory is physically counted at the end of a defined period, such as weekly, monthly, or quarterly. This means that any changes in inventory due to sales, purchases, or returns are not recorded in real-time; instead, the total inventory is assessed only at the conclusion of the period.

This approach can be beneficial for small businesses or those with less complex inventory needs, as it simplifies record-keeping and tracking. However, it may result in less accurate and timely information about inventory levels, since it doesn't reflect ongoing transactions.

Other systems mentioned, like the perpetual inventory system and the real-time inventory system, keep continuous track of inventory changes with every transaction. The manual inventory system can imply physical counting as well, but the periodic inventory system specifically highlights the timing of updates as defined by set intervals.