Jax Mercantile Co. has been northern Colorado’s premier outdoor gear source for over 50 years. Jax sells men’s, women’s, and children’s clothing for any outdoor activity. Customers can also find camping and fishing gear, mountaineering tools, and hunting items. If a customer is not the outdoor type, Jax still offers plenty of other products, such as specialty kitchenware and household decorative items. Jax also carries a full line of optics and photography products, agricultural and automotive accessories, animal care products, and lawn and garden accessories.
Jax has succeeded in stocking a large inventory that meets customers’ outdoor and indoor gear needs. When Jax purchases inventory for resale, it must have a way of recording these purchases. Jax also must have a way to record the sales of goods to customers and be able to handle returns and discounts. Considering the size of Jax’s inventory ( in items and in dollar amount), would Jax use a periodic or perpetual inventory system? Explain your answer.