Test 3

Question 1

What is the Original Cost Method of Inventory evaluation?

Answer 1

It is a method used by stores with slow turnover or small inventory in comparison to sales volume.

Question 2

When is the Original Cost Method appropriate?

Answer 2

This method is appropriate only when the number of transactions is limited and items have a high unit value.

Question 3

Open-to-Buy

Answer 3

Is the amount of merchandise that a retailer may order during the balance of a period