Question 1
Describe the different types of costs associated with inventory. Inventory costs can be divided into three main categories, namely purchase costs (the cost of procurement), storage costs (maintenance) and costs related to the lack of goods (shrinkage). Purchase costs (also called as the costs of order preparation, especially when it comes to production), or restocking are economic consequences caused by direct orders, that is, costs that arise every time the company place customer’s order. These costs can be divided into two parts: the costs directly for the placement of the order (they can be persistent and do not Continue reading...
