Which of the following statements about inventory control is TRUE?
A)Too little inventory may lead to opportunity costs in the form of missed sales.
B)Too much inventory may reduce profitability due to increased financing and storage costs.
C)Seasonality in sales may require a firm to hold different levels of inventory throughout the year.
D)All of the statements about inventory control are true.

Question

Quizplus · Accepted Answer

All of the statements about inventory control are true. Too little inventory can result in missed sales opportunities, while too much inventory can increase financing and storage costs, ultimately reducing profitability. Additionally, seasonality in sales may require a firm to hold different levels of inventory throughout the year. Effective inventory control involves finding a balance between these factors to optimize sales and profitability.

Which of the Following Statements About Inventory Control Is TRUE