Which One of the Following Descriptions of a Base-Stock System

question 149

Multiple Choice

Which one of the following descriptions of a base-stock system is best?

• A)It is particularly attractive when review and ordering costs are both significant.
• B)It can be seen as a way to minimize cycle inventory.
• C)Examples include gasoline storage tanks at a service station.
• D)An item's inventory is stored at two different locations or "bins."

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Definitions:

Credit Sales

Sales in which the customer is allowed to purchase goods or services on the agreement they will pay at a later date.

Cash Receipts

Monies received by a business, recorded during the period they are received, including cash sales and collections from customers.

Projected Sales

Future sales estimates based on historical data, market analysis, and other predictive techniques.

Accounts Receivable

The amount of money owed to a company by its customers for goods or services sold on credit.