Which of the following costs would be incurred in an inventory stockout?
A) Lost sales, lost customers, and backorder.
B) Lost sales, safety stock, and backorder.
C) Lost customers, safety stock, and backorder.
D) Lost sales, lost customers, and safety stock.

Question

Quizplus · Accepted Answer

In an inventory stockout, a company may face lost sales due to inability to fulfill orders, lost customers who may turn to competitors, and costs associated with managing backorders. Safety stock is a preventive measure, not a cost incurred during a stockout.

Which of the Following Costs Would Be Incurred in an Inventory