Summary
Inventory represents a major investment for many firms. This investment is often larger than it should be because firms find it easier to have “just-in-case” inventory rather than “just-in-time” inventory. Inventories are of four types:
Raw material and purchased components
Work-in-process
Maintenance, repair, and operating (MRO)
Finished goods
In this chapter, we discussed independent inventory, ABC analysis, record accuracy, cycle counting, and inventory models used to control independent demands. The EOQ model, production order quantity model, and quantity discount model can all be solved using Excel, Excel OM, or POM for Windows software.
Key Terms
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