Which of the following statements about abc analysis is false

Asked by admin @ 16/10/2021 in Business viewed by 328 People

Which of the following statements about ABC analysis is FALSE? A. ABC analysis is based on the presumption that all items must be tightly controlled to produce important cost savings. B. ABC analysis is based on the presumption that controlling the few most important items produces the vast majority of inventory savings. C. In ABC analysis, "A" items should have tighter physical inventory control than "B" or "C" items have. D. In ABC analysis, forecasting methods for "C" items may be less sophisticated than for "A" items. E. Criteria other than annual dollar volume, such as high holding cost or delivery problems, can determine item classification in ABC analysis.

Answered by admin @ 16/10/2021

Answer:

The correct answer is letter "A": ABC analysis is based on the presumption that all items must be tightly controlled to produce important cost savings.

Explanation:

ABC analysis is a method to value inventory in a company. "A" items are highly valuable, "B" items have an intermediate value, while "C" items are goods with less importance. The ABC analysis is based on the Pareto principle that 80% of the consumption relies on 20% of valuable items. In such a scenario:

"A" items (20% value): provide 80% of consumption
"B" items (30% value): provide 15% of consumption
"C" items (50% value): provide 5% of consumption

Therefore, ABC analysis has nothing to do with goods costing in an entity.

Able, baker, and charles are engaged in the marketing to and enrollment of beneficiaries into medicare health plans. mr. able is an independent agent paid directly by a health plan. ms. baker is an independent agent paid through a field marketing organization (fmo). mr. charles is an independent agent paid for his work by a third-party marketing organization (tmo). how do the cms compensation rules apply to these three agents?

Asked by maham237 @ 13/01/2021 in Business viewed by 2744 persons

Which of the following statements about abc analysis is false

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