The Goal of Managing Working Capital, Such as Inventory, Should

question 1

Multiple Choice

The goal of managing working capital, such as inventory, should be to minimize the:

• A) costs of carrying inventory.
• B) opportunity cost of capital.
• C) aggregate of carrying and shortage costs.
• D)amount of spoilage or pilferage.

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Definitions:

Number of Employees

The total count of individuals working for a business or organization, either full-time or part-time.

Indirect Expenses

Costs that are not directly attributable to the production of goods or services, such as utilities and rent.

Allocated

Refers to the distribution or assignment of costs or resources to different accounts, projects, or periods.

Cost of Goods Sold

The total direct costs attributable to the production of the goods sold by a company, including materials and labor.