Material and Inventory Control

Question 1

What are the 3 components of inventory in manufacturing?

Answer 1

Direct material
Work-in-process
Finished goods

Question 2

What are the 4 categories of cost associated with trading inventories?

Answer 2

Purchasing costs
Ordering costs
Stock-out costs
Quality costs

Question 3

What are the 2 inventory systems?

Answer 3

Perpetual
Periodic

Question 4

What are the 2 methods of inventory valuation that may be used in SA?

Answer 4

FIFO
Weighted average