Interesting question .
First, let me ask the question which may sound so basic. That is the difference between the two methods.
Am I correct to say that perpetual charges COGS with every sale. As opposed to the periodic which means all purchases and related costs are added to beginning inventory, and then ending inventor is subtracted to arrive at COGS.
If I am right, then in either Perpetual or Periodic, you are employing a cost flow assumption. Those cost flow assumptions being average , fifo or lifo.
Most GL systems , I would think , use Average cost flow as does QuickBooks. Hence, unless you are changing the cost flow assumption of valuing the ending, I do not believe you have an accounting change.
Let's see what others think.
Abby Alhante, CPA
Kurcias & Alhante, LLC CPAs
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Melville NY 11747
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