Companies That Have a Spend Analysis Process in Place Tend

question 119

Multiple Choice

Companies that have a spend analysis process in place tend to have

• A) significantly higher procurement costs.
• B) fewer suppliers.
• C) a less efficient supply chain in terms of speed and quality.
• D) a less advanced e-procurement systems.

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Definitions:

Periodic Inventory System

An inventory system where updates to inventory levels are made on a periodic basis rather than continuously.

Cost of Goods Sold

Cost of Goods Sold (COGS) refers to the direct costs attributable to the production of the goods sold by a company, including materials and labor.

Purchases

The total amount of goods and materials acquired by a business for the purpose of resale or production during a specific accounting period.

Cost of Goods Sold

The costs directly linked to producing a company’s sold goods, encompassing labor and materials.