Question
Indicate whether each of the following statements is true or false. _____ a. The cost of interest given up to use one's own money to
Indicate whether each of the following statements is true or false.
_____ a. The cost of interest given up to use one's own money to buy inventory is often called "inventory loss."
_____ b. Even if a firm buys inventory with its own money, rather than by borrowing, there is still a "cost" involved with financing the inventory.
_____ c. As much as possible, businesses should reduce the time for which goods stay in inventory.
_____ d. Buying inventory on account (with no interest charged) is always the best way to avoid inventory-financing cost.
_____ e. One way to reduce inventory-financing cost is to offer sales discounts to customers.
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