After reading Chapter 4 of zietlow, J. (2021). Short-Term Financial Management ebook plus Active Learning courseware (6th
Question:
After reading Chapter 4 of zietlow, J. (2021). Short-Term Financial Management ebook plus Active Learning courseware (6th ed.). Cognella, Inc.. https://online.vitalsource.com/books/809553AAL
Questions
1. Discuss the three types of inventory.
2. What are the primary motives for carrying inventory?
3. What factors influence the precautionary motive for inventory?
4. List the costs of carrying inventory on the balance sheet.
5. All else constant, identify the effect of each of the following on the level of inventory:
a. Decrease in DIH b. Increase in daily CGS c. Increase in DIH and decrease in CGS
6. Explain what the EOQ solution represents.
7. Identify the effect of each item on the EOQ (assume that each change occurs in isolation): a. Per unit holding cost increases / decreases b. Fixed ordering cost increases / decreases c. Demand increases / decreases
8. Discuss the relationship between DIH and inventory turnover.
9. How is the balance fraction approach used to monitor inventory?
10. Discuss trends in the DIH.
Expert Answer:
Sure here are the answers to your questions 1 The three types of inventory are a Raw materials inventory These are the materials and components that are used in the production process but have not yet ... View the full answer
