Poor Capacity Planning Can Result in

question 49

Multiple Choice

Poor capacity planning can result in

• A) unbudgeted increase in employee overtime
• B) excess inventory
• C) increase in the number of stockouts during peak demand periods
• D) all of the above

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Definitions:

Unsecured Promissory Note

A type of debt instrument that doesn’t require collateral but is backed only by the borrower's promise to pay the lender back.

Cash Conversion Cycle

The time it takes for a company to convert its investments in inventory into cash flows from sales.

Inventory System

An inventory system is a mechanism for tracking the sale, purchase, and storage of goods, facilitating efficient management and control of inventory.

DSO

Days Sales Outstanding, a financial metric that calculates the average number of days it takes a company to collect payment after a sale has been made.