Inventory Levels Increase by 10% at Your Company During the Fourth

question 186

Multiple Choice

Inventory levels increase by 10% at your company during the fourth quarter.Based on this increase,which of the following statements must be correct?

• A)This must be good news because inventories are an asset to the company.
• B)This could be good news if the company is ordering more goods because sales appear to be rising.
• C)This could be bad news if the company is ordering more goods because unit costs are falling.
• D)This must be bad news because higher inventories mean higher costs.

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