Explain the Importance of Inventory for Retailer and Manufacturers? What

question 70

Short Answer

Explain the importance of inventory for retailer and manufacturers? What is management's objective in managing inventory? Explain how this objective is achieved.

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Definitions:

Residual Value

The estimated amount that an asset is worth at the end of its useful life.

Net Income

What a company ultimately makes, after subtracting everything it spends including taxes and costs, from the revenue it generates.

Average Rate

The mean rate or level for a particular variable over a specified period, often used in reference to interest or exchange rates.

Present Value Methods

Techniques used to determine the current worth of a future stream of cash flows, discounted at a particular rate.