Excess inventory . . .? a. Leads to costly inventory writedowns. b. Incurs unnec
ID: 466294 • Letter: E
Question
Excess inventory . . .?
a. Leads to costly inventory writedowns.
b. Incurs unnecessary physical warehousing costs.
c. Causes an increase in stockout costs.
d. Ties up capital in inventory that is not needed.
e. All of the above
f. Only A, B, and D
The key question inventory management is concerned with is
a. How do you price inventory for quick sale?
b. How do you move inventory faster through the supply chain?
c. How much inventory do you need?
d. How do you reduce inventory carrying costs?
a. Leads to costly inventory writedowns.
b. Incurs unnecessary physical warehousing costs.
c. Causes an increase in stockout costs.
d. Ties up capital in inventory that is not needed.
e. All of the above
f. Only A, B, and D
The key question inventory management is concerned with is
a. How do you price inventory for quick sale?
b. How do you move inventory faster through the supply chain?
c. How much inventory do you need?
d. How do you reduce inventory carrying costs?
Explanation / Answer
1.Only A, B, D
Excess inventory leads to costly inventory writedowns and also incurs unnecessary warehousing cost which cannot be mapped to any sale unit. It also ties up capital in inventory that is not needed.
2. How much inventory do you need?
The key question is "how much inventory do you need?" . It is the most basic and critical question in the planning of inventory because if we know about inventory requirement then we can easily plan it thus reducing carrying cost or inventory procing for quick sale.
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