Perpetual inventory system
Material turnover ratio
Level setting
ABC analysis
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Answer is Wrong!
The correct answer is D. ABC analysis.
ABC analysis is a method of inventory control that classifies items into three categories: A, B, and C. Items in category A are the most important and expensive, and require the most attention. Items in category B are less important and less expensive, and require less attention. Items in category C are the least important and least expensive, and require the least attention.
ABC analysis is a useful tool for businesses because it helps them to focus their attention on the most important items in their inventory. This can help businesses to save money, improve efficiency, and reduce risk.
Here is a brief explanation of each option:
- A perpetual inventory system is a system of inventory control that keeps track of inventory levels on a continuous basis. This is done by recording all sales and purchases as they occur.
- Material turnover ratio is a measure of how quickly a business sells its inventory. It is calculated by dividing the cost of goods sold by the average inventory.
- Level setting is a method of inventory control that aims to keep inventory levels constant. This is done by ordering inventory in regular intervals, regardless of sales.
I hope this helps!