List and Briefly Identify the Three Basic Measures of Inventory

question 14

Essay

List and briefly identify the three basic measures of inventory that managers use to keep inventory costs from becoming too large.

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Definitions:

Capital Acquisitions Ratio

A measure used to evaluate a company's ability to fund its investment in fixed assets using cash from operating activities.

Outside Financing

Outside financing is the capital a company raises from external sources, such as bank loans, private investors, or public offerings, to fund its operations, growth, and investments.

Operating Activities

Business activities directly related to the production and delivery of goods and services, which are the main revenue-producing activities of an enterprise.

Net Cash Flow

The difference between a company's cash inflows and outflows within a specified period.