Which of the Following Is an Approach a Company Can

question 41

Multiple Choice

Which of the following is an approach a company can use to create a buffer for forecast error using safety inventory?

• A) Overtime
• B) Carry extra workforce permanently
• C) Build and carry extra inventories
• D) Subcontracting
• E) Purchase capacity or product from an open or spot market

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Definitions:

Unrealized Gain or Loss

The increase or decrease in the value of an investment that has not yet been sold and turned into cash.

Equity Section

The portion of a company’s balance sheet that represents the owners' or shareholders' interest in the company.

Equity Method Investments

Accounting technique used by a company to record its investment in another company when it has significant influence but does not have a majority control.

Cash Dividends

Payments made by a corporation to its shareholders from earnings, typically on a quarterly basis, in the form of cash.