Question

Which technique of controlling inventory costs involves maintaining some quantity of goods as a buffer to utilize in times of emergency?
A.
the ABC classification
B.
the economic order quantity method
C.
the just-in-time system
D.
the safety stock concept

Answer 1

Answer:

D. the safety stock concept

Explanation:

Safety stock describes a quantity of inventory that a business maintains in its custody at all times. The objective of keeping safety stock inventory is to prevent the business from experiencing stock-outs. Applying the concept of safety stock means not allowing the inventory to go below the level marked at safety stock.

The technique of safety stock demands that stock be ordered every time inventory approaches safety stock. Allowing inventory to fall below the safety stock is risking running out of stock leads to halting production.

Answer 2

Answer:

D, safety stock

Explanation:

Correct on Plato Edmentum