An effective strategy to manage cash flows requires retail businesses to eliminate their inventory.

Question

Quizplus · Accepted Answer

Financial managers face a trade-off when dealing with inventory. Investment in inventory is costly, but businesses must maintain some inventory in order to provide customers an adequate selection of available goods. The goal of inventory management is not to eliminate inventory but rather to minimize the cost of holding inventory.

An Effective Strategy to Manage Cash Flows Requires Retail Businesses