Inventory does not tie up cash. You should have as much inventory on hand as possible.

Question

Quizplus · Accepted Answer

Keeping excess inventory on hand ties up cash that could be used for other expenses or investments. It also increases the risk of holding obsolete or slow-moving inventory, which can result in losses. It is important to maintain a balance between having enough inventory to meet customer demand and minimizing excess inventory.

Inventory Does Not Tie Up Cash