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Q. What are the benefits as well as costs of holding inventory?
What is Inventory? What are the benefits as well as costs of holding inventory?
Ans. Inventory: - Every enterprise requires inventory for smooth running of its activities. The term inventory demotes to stock of goods kept for sale by the firm.
Types of Inventories:-
(A) In Trading Concern.
(B) In Manufacturing Concern.
(A) In Trading Concern: - In case of trading concerns it comprises only finished goods.
(B) Manufacturing Concern: - In case of mechanized concern inventory may perhaps include:-
(i) Inventory of Raw Materials
(ii) Inventory of Work-in-progress
(iii) Consumables
(iv) Inventory of Finished Goods
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