Which of the Following Is True of Just-In-Time (JIT)inventory Management

question 65

Multiple Choice

Which of the following is true of just-in-time (JIT) inventory management?

• A)It results in more storage and insurance cost.
• B)It is a system in which the company produces product only after receiving an order.
• C)It promotes surplus inventory to prevent production shut-down in case of supply interruptions.
• D)It requires a surplus inventory of finished goods to ensure timely, or just-in-time, delivery to customers.

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Definitions:

Throughput

The rate at which a system or process produces goods or handles material, often measured within a specific time frame.

Operating Expenses

Costs associated with the day-to-day functioning of a business that are not directly tied to production, such as salaries and rent.

Production Processes

Refers to the sequence of activities or operations involved in transforming raw materials into finished goods.

Value Analysis

A systematic assessment to identify and eliminate unnecessary costs in product design without sacrificing functionality or quality.