cyber-resilience framework of the National Institute of Standards and Technolog Which one of the following options is correct with respect to the knowledge required for the calculation of inventory availability?1. Current levels of stock on hand.II. Stock on order.II. Supplier lead time.IV. Historical data on stock.Options Il and IV only.Options II, III and IV only.Options I, Il and III only.Options I and IIl only.

Answered: e calculation of inventory availability

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Question

cyber-resilience framework of the National Institute of Standards and Technolog

Which one of the following options is correct with respect to the knowledge required for the calculation of inventory availability?
1. Current levels of stock on hand.
II. Stock on order.
II. Supplier lead time.
IV. Historical data on stock.
Options Il and IV only.
Options II, III and IV only.
Options I, Il and III only.
Options I and IIl only.

Expert Solution

Evaluation of options

Option I is correct because by knowing the current stock levels, the calculation of inventory availability can be made.

Option II is correct because in order to calculate the inventory availability, the stock on order is required. It helps to estimate whether the order can be met.

Option III is wrong because supplier lead time, the time period between order of purchases and receipt of delivery, is not used for determining the inventory available. Inventory available is to be calculated based on the needs of the customers.

Option IV is wrong because by analyzing the historical data on stock, no calculation can be done regarding the current inventory available.