What is an advantage of using a Periodic Inventory System?

Using a Periodic Inventory System is particularly advantageous for small businesses with minimal inventory because it simplifies inventory management. In this system, inventory counts and valuations are conducted at specific intervals rather than continuously, which reduces the amount of record-keeping required. Since small businesses often have a limited variety and quantity of products, a periodic system allows them to maintain adequate inventory records without the complexity and effort associated with a perpetual system. It is effective for managing inventory when the volume is low, making it a practical choice for small operations where resources may be constrained and less sophisticated inventory management software may not be affordable.

While other options may hold some truth, they do not capture the core benefit of the periodic approach in the context of small businesses, which highlights its simplicity and resource efficiency.