What characterizes a perpetual inventory system?

A perpetual inventory system is characterized by its ability to continuously track inventory levels in real-time. This system updates inventory records immediately with each purchase or sale transaction, allowing businesses to maintain accurate and up-to-date records of inventory at all times.

The real-time tracking enables companies to monitor stock levels closely, which helps in making informed purchasing decisions, managing stock efficiently, and responding quickly to customer demand. Additionally, the constant updates reduce the need for frequent physical counts of inventory since users can always refer to current records. This system often utilizes technology such as barcode scanners and inventory management software to ensure precise tracking.

In comparison, other methods may not provide the same level of ongoing insight into inventory levels, making option B the best descriptor of a perpetual inventory system.