Dell Requires That Each Customer Order a Computer and Pay

question 18

Multiple Choice

Dell requires that each customer order a computer and pay for it in advance. What is their inventory strategy?

• A) Running cost optimization
• B) Near-zero inventory
• C) Carrying costs
• D) Bottleneck
• E) Reorder point management

---

Definitions:

Product Costs

Costs directly associated with the manufacturing of goods, including direct materials, direct labor, and manufacturing overhead.

Absorption Costing

A financial method that integrates all production-related costs — direct materials, direct labor, and both variable and fixed overheads — into the cost calculation of a product.

Manufacturing Overhead

Indirect factory-related costs that are incurred when a product is manufactured, including costs related to operating the manufacturing facilities.