Which of the Following Is NOT a Cost Associated with Holding

question 35

Multiple Choice

Which of the following is NOT a cost associated with holding inventory?

• A)Money tied up in holding inventory is not available for other purposes.
• B)Inventory generates storage and insurance costs.
• C)The ability to meet a surge in demand for the goods carried in inventory.
• D)Items in inventory may become obsolete and unsellable at a profitable price.

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Definitions:

Indirect Spend

Expenses on goods and services that are not directly incorporated into a product being manufactured, such as office supplies or professional services.

Direct Spend

Expenditures directly associated with the production of goods or services, such as raw materials and manufacturing costs.

Value Requirement

The essential features or characteristics that a product, service, or process must possess to meet stakeholder or customer needs.

Business Partnerships

Cooperative agreements between two or more business entities to work together towards shared objectives.