A quantity of merchandise or materials over the minimum needed that reduces the risk of running short is called:
A) Just-in-time inventory.
B) Budgeted stock.
C) Continuous inventory.
D) Capital stock.
E) Safety stock.

Question

Quizplus · Accepted Answer

Safety stock refers to the extra quantity of inventory that is held to reduce the risk of running out of stock in case of unexpected demand or supply chain disruptions. This helps businesses to ensure continuous operations and maintain customer satisfaction. Just-in-time inventory refers to keeping only the minimum amount of inventory needed to fulfill current demand, while budgeted stock refers to the inventory level set based on available budget. Continuous inventory refers to the ongoing process of monitoring and updating inventory levels, while capital stock is a term used in economics to describe the total value of assets held by a company.

A Quantity of Merchandise or Materials Over the Minimum Needed