Functions of inventory control, Business Management

Assignment Help:

1. Ensure Timely Availability of Materials: Inventory control helps is preventing delays due to lack of materials by ensuring regular supply of proper qualities of materials at the right time. So it internal and external factors.

2. Better use of Financial Resources : It minimizes the capital investment in the stock of materials. The decision regarding appropriate size of inventory is significant. An unreasonably big or small inventory is uneconomical to any organization. The decisions regarding size of inventory should be based on sound principle and techniques. This leads to healthy practice of wise spending in inventories.

3. Protecting the Inventory from Losses : A good inventory systems develops a set of policies regarding loss due to improper handling or store of goods and unauthorized removal from stores. Obsolescence and deprecation are kept at minimum possible level.

4. Provides Protection Against the Uncertainties of Demand and supply : Maintenance of specified raw materials general supplies work in process and component parts in sufficient quantities to meet the demand of production. Inventory control system ensures the regular supply of proper quantities of materials at the right time.

5. Preparation of Accurate Materials Reports: Inventory control helps in keeping perpetual inventory systems and other records to facilitate the preparation of accurate material reports. Perpetual inventory is a systems of records maintained by the controlling department which reflects the physical movement sof stock and their current balance. It furnishes quickly and accurately the value of materials used in various departments. This facilitates quick decisions and prompts action.

6. Determining of Results : The proper determination of profit depends upon the proper valuation. A major objective of account for inventories is the proper determination of income through the process of matching appropriate costs against revenues. It provides the data on running basis and thus facilitates the preparation of financial statement at shorter intervals.

7. Minimize Wastages and Rate of Deterioration : Inventory control systems also aims at controlling all types of wastages and losses of materials which may arise due to carelessness in the storing issuing and handling of materials .it helps in eliminating wastage in the use of materials by controlling obsolete items and slow moving items costs and losses.


Related Discussions:- Functions of inventory control

Breakdown maintenance, As the name suggest corrective maintenance occurs...

As the name suggest corrective maintenance occurs when there is a work stoppage because of machine breakdown. In this sense maintenance becomes repair work. Repairs are

Evaluate a news coverage in the written press, Question 1: How would yo...

Question 1: How would you evaluate a News Coverage in the written Press and the Electronic Media? Question 2: A big multinational company wishes to employ a PR manage

Conduct a force-field analysis, Enacting change is difficult. The forces th...

Enacting change is difficult. The forces that create the need for change often bump up against equally powerful forces of resistance. Think of an organization with which you are fa

Differentiate between a work group and a work team, Problem: (a) Diff...

Problem: (a) Differentiate between a work group and a work team. (b) Explain clearly the different types of team in organisation. (c) Referring to your organization o

Describe advantages and disadvantages of holding inventory, Describe advant...

Describe advantages and disadvantages of holding inventory You are the Logistics Manager for a Spanish retailer of sports clothing and equipment (shirts, shorts, swimwear, train

What is the entrepreneur, What is the Entrepreneur? Meaning of Entrep...

What is the Entrepreneur? Meaning of Entrepreneur: An Entrepreneur perceives a requirement and after that brings together material, manpower and capital needed to meet th

Explain about the term quality in management, Explain about the term Qualit...

Explain about the term Quality in Management. Quality: Quality is described as fitness of purpose. It is a relative term and is usually explained along with reference to

Healthcare, A 20-year-old male patient arrives at a Level One Trauma emerge...

A 20-year-old male patient arrives at a Level One Trauma emergency facility (capable of caring for virtually any emergency).

Write Your Message!

Captcha
Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd