Scribd Logo
Upload

Welcome to Scribd!

  • Introduction Inventory Control Key Recap

    Uploaded by

    Jesus Mata Facenda
    3 views3 pages
    ABC analysis classifies inventory items into categories based on their annual spending, with category A items accounting for the largest value. Independent demand refers to an item's demand that does not rely on another item, like finished goods, while dependent demand relies on another item's demand, such as components of finished goods relying on demand for the finished product. Periodic review and fixed order quantity are used to manage independent demand inventory, while material requirements planning and just-in-time are used to manage dependent demand inventory, with MRP using forecasts and JIT using actual production to order components.

    Original Description:

    Original Title

    introduction_inventory_control_key_recap

    Copyright

    © © All Rights Reserved

    Available Formats

    PDF, TXT or read online from Scribd

    Did you find this document useful?

    Is this content inappropriate?

    Report this Document
    ABC analysis classifies inventory items into categories based on their annual spending, with category A items accounting for the largest value. Independent demand refers to an item's demand that does not rely on another item, like finished goods, while dependent demand relies on another item's demand, such as components of finished goods relying on demand for the finished product. Periodic review and fixed order quantity are used to manage independent demand inventory, while material requirements planning and just-in-time are used to manage dependent demand inventory, with MRP using forecasts and JIT using actual production to order components.

    Copyright:

    © All Rights Reserved
    Download as PDF, TXT or read online from Scribd
    Flag for inappropriate content
    3 views3 pages

    Introduction Inventory Control Key Recap

    Uploaded by

    Jesus Mata Facenda
    ABC analysis classifies inventory items into categories based on their annual spending, with category A items accounting for the largest value. Independent demand refers to an item's demand that does not rely on another item, like finished goods, while dependent demand relies on another item's demand, such as components of finished goods relying on demand for the finished product. Periodic review and fixed order quantity are used to manage independent demand inventory, while material requirements planning and just-in-time are used to manage dependent demand inventory, with MRP using forecasts and JIT using actual production to order components.

    Copyright:

    © All Rights Reserved
    Download as PDF, TXT or read online from Scribd
    Flag for inappropriate content
    of 3

    ABC analysis is used to determine the frequency and quantities of orders for inventory items.

    ABC analysis classifies inventory items by their annual consumption value, which is the amount
    spent by the company on an item each year.

    Independent demand is the demand for an inventory item that does not depend on the demand
    for another inventory item. A retailer’s demand for finished goods is an example of independent
    demand.
    Dependent demand is the demand for an inventory item that does depend on the demand for
    another inventory item. For example, the demand for the components of a finished good
    depends on the retailer’s demand for the finished good itself.

    The ”Periodic review” and ”Fixed order quantity” methods are used to manage the inventory of
    independent demand items.

    ”Material requirements planning (MRP)” and ” Just-in-time (JIT)” methods are used to manage
    the inventory of dependent demand items.
    MRP uses a demand forecast for the finished product to order its components, whereas JIT uses
    actual production of the finished product to order components.

    You might also like