The operations manager has noticed that a lot of the stock is obsolete and has advanced the case that this should be scrapped. The proposed amount to be scrapped is approximately 350 K. This material could be recycled and lead to lower material purchases (though only about 10 K). Why might the finance manager be concerned about this proposal? If the proposal went through, how would this impact on the accounts?

Answer rating: 100% (QA)

The finance manager might be concerned about the proposal to scrap obsolete stock for several reasons 1 Loss of Asset Value Scrapping obsolete stock m... View the full answer