The total cost of keeping inventory is the sum of the cost to buy the inventory,the cost to store,protect,and maintain inventory,and the cost of making an order to purchase inventory.

Question

Quizplus · Accepted Answer

The total cost of keeping inventory includes the cost to buy the inventory (ordering cost), the cost to store, protect, and maintain inventory (holding cost), and the cost of making an order to purchase inventory (stockout cost). Therefore, the statement is true.

The Total Cost of Keeping Inventory Is the Sum of the Cost