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Inventories

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Describe inventory. What are the different types of inventories maintained? Provide some examples. How does inventory affect a firm's financial performance and customer service levels? How would you improve those inventories?

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Solution Summary

The solution provides some details about inventories relating to types of inventory; impact to financial performance; examples.

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Inventory is described as anything which is purchased with the intention of resale. A company would purchase either raw materials and convert them to finished goods or purchase finished goods themselves for further sale and these would be classified as inventories.

Different types of inventories are - raw material inventory, work in process inventory and finished goods inventory. Raw materials are materials which have to be worked upon before they can be sold. When ...

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