Inventory Levels Increase by 10% at Your Company During the Fourth

question 108

Multiple Choice

Inventory levels increase by 10% at your company during the fourth quarter.Based on this increase,which of the following statements is true?

• A)This is always good news because inventories are an asset to the company.
• B)This could be good news if the company is ordering more goods because sales appear to be rising.
• C)This could be bad news if the company is ordering more goods because unit costs are falling.
• D)This is always bad news because higher inventories mean higher costs.