All of the following statements about ABC analysis are true except A) inventory may be categorized by measures other than dollar volume B) it categorizes on-hand inventory into three groups based on annual dollar volume C) it is an application of the Pareto principle D) it states that all items require the same degree of control E) it states that there are the critical few and the trivial many inventory items

Question

Quizplus · Accepted Answer

ABC analysis does not state that all items require the same degree of control. In fact, it suggests that high-value items (A items) should receive the highest degree of control, and low-value items (C items) may require less control.

All of the Following Statements About ABC Analysis Are True