Perpetual Inventory Method Law and Legal Definition

The process of deriving data on stocks from transaction data is known as the perpetual inventory method. Under this method, a stock estimate for some base point in time is required. The compiler may calculate the value of a stock at the end of a period as being equal to the value of the stock at the beginning of the period, plus the impact of transactions and nontransaction changes in the value of the stock during the period.