ENTREPRENEURIAL OPERATIONS
INVENTORY MANAGEMENT
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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The cost of Insurance and Taxes are included in
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Cost of ordering
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Set up cost
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Inventory Carrying cost
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Cost of shortage
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Explanation:
Detailed explanation-1: -Inventory carrying cost is the cost the sum of expenses for handling or storing any unsold goods. These costs incorporate warehousing, labor, insurance, rent, combined with the value of damaged, expired, or out-of-date products.
Detailed explanation-2: -Insurance on unsold products is also a type of carrying cost, as is the opportunity cost of the value of the inventory that hasn’t sold yet. Determining your company’s carrying costs is necessary for calculating the EOQ using the ordering cost formula.
Detailed explanation-3: -Storage cost is not included in the cost of inventory.
There is 1 question to complete.