Inventory Management: Control Levels, Methods and EOQ model! The objective of inventory management is to minimize the total of inventory carrying and ordering costs while ensuring that 'stock-outs' do not occur and the surplus stocks are not accumulated and carried. Inventory Management Control Levels: Firms establish control levels for standard materials, which are in regular use. Control levels cannot be [...]
The following points highlight the four main inventory systems. The systems are: 1. Perpetual Inventory System 2. Continuous Stock Taking System 3. Periodic Stock Taking System 4. Two Bin System. 1. Perpetual Inventory System: CIMA defines perpetual inventory system as "the recording as they occur of receipts, issues and the resulting balances of individual items of stock in either quantity [...]
In this article we will discuss about the definition and features of inventory. Definition of Inventory: ICAI has defined inventory as "tangible property held (i) for sale in the ordinary course of business or (ii) in the process of production for sale or (iii) for consumption in the production of goods or service for sale, including maintenance supplies and consumable [...]