Managing Inventories to Increase Net Income Requires Companies to Effectively

question 23

Essay

Managing inventories to increase net income requires companies to effectively manage costs associated with goods for sale.
Required:
Classify the below listed items as either Purchasing Costs,Ordering Costs,Carrying Costs,Stockout Costs,Costs of Quality,or Shrinkage Costs.
___a. costs of obtaining purchase approvals
___b. costs resulting from embezzlement by employees
___c. internal failure costs
___d. opportunity cost of the investment tied up in inventory
___e. costs associated with storage
___f. costs of lost sales as a result of not having an item requested by a customer
___g. freight-in charges
___h. special processing costs
___i. costs of wages for work-int-process inspections
___j. costs that result from misclassifications and clerical errors

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Definitions:

Creative

Reflecting the ability to generate innovative ideas, solutions, or works that have value and are original.

Either/or Fallacy

A logical fallacy that presents only two options or outcomes when in reality more possibilities exist.

Creative Solutions

Innovative and effective answers or approaches devised to solve problems or challenges.

Open Mode

Open Mode is a state or approach characterized by openness, receptiveness, and readiness to explore new ideas, perspectives, or experiences without prejudgment.