Reference no: EM132243972
True and False
1. Acme Inc. hold an annual average inventory is $2,000,000, while the annual CGS is $10,000,000. Given this, the inventory turns is equal to four.
2. Epicure LLC. has a part X with a demand of 660 units per month. Right now, there are 100 part X’s in stock. There are twenty days in a month, thus there is approximately 3 days’ supply of part X.
3. Acme has a cost of capital of 10%. Yearly inventory level is $1,000,000, while its costs to store are 8%, and risk costs are 7%. As a result, the annual cost to carry this inventory is $200,000.
4. Acme has decided to order less material Y when it is time to order. This will result in reduced inventory carrying costs
5. Finished goods inventory and raw materials not issued are all examples of work-in- process inventory.