AAT Level 3 Management Accounting Techniques (MATS) Practice Test

Periodic review inventory control means replenishment orders are placed at what times?

When inventory falls below a fixed level Immediately when stock runs out At fixed intervals regardless of level Only when supplier indicates

Correct Answer:

At fixed intervals regardless of level

Explanation:

Periodic review means you check and place replenishment orders at fixed, regular intervals. At each review, you assess current stock and order enough to bring the inventory up to a predetermined target level, regardless of how much stock you have at that moment. This differs from continuous review, where an order is triggered as soon as stock falls to a reorder point. So the timing of orders is set by the schedule, not by the stock level.

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