The Portion of Inventory or Production Not Committed to Customer

question 21

Multiple Choice

The portion of inventory or production not committed to customer orders is called:

• A) free stock
• B) available to promise
• C) excess production
• D) waste
• E) excess capacity

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Definitions:

Term Lending Agreement

A contractual agreement between a borrower and a lender that stipulates the terms and conditions under which a loan will be advanced and repaid over a specific period.

Original Maturity

The original duration set during the issuance of a financial instrument, such as a bond or loan, indicating the period until the principal is supposed to be paid back.

GAAP

The standardized set of accounting principles, standards, and procedures issued by the Financial Accounting Standards Board (FASB) for companies in the U.S.

Fair Value

The income from offloading an asset or the charge for transferring a liability in a methodical exchange among participants in the market at the time of determining its value.