A Firm in the Higher Echelon of an Efficient Supply

question 85

Multiple Choice

A firm in the higher echelon of an efficient supply chain is likely to have

• A) low inventory turns.
• B) a flexible flow process.
• C) high- capacity utilization.
• D) high- capacity cushions.

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Definitions:

Weighted-Average Method

A cost accounting method that calculates inventory and the cost of goods sold based on the average cost of all similar items in inventory.

First-In-First-Out (FIFO)

An inventory valuation method where the first items produced or acquired are the first to be sold or used, reflecting the chronological flow of goods.

Weighted-Average Method

An inventory costing method that assigns a weighted average cost to each unit in inventory, used in both periodic and perpetual inventory systems.

Cost Control

The practice of managing and reducing business expenses through efficient operations and spending.