Which category of inventory holding costs would be much higher than average for rapidly changing industries such as personal computers and cell phones

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05-07-2022
Business

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Which category of inventory holding costs would be much higher than average for rapidly changing industries such as personal computers and cell phones

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krithikasmart11 krithikasmart11 · Answer 1 · 2022-07-13T05:00:47-04:00

Inventory holding costs would be much higher than average for rapidly changing industries such as personal computers and cell phones in the category of Pilferage, Scrap and Obsolescence costs.

Any business that sells products has one of the highest capital expenditures as inventory. This sort of company's balance sheet is likely to show that inventory consumes a significant amount of working capital and makes up a sizable component of current assets.

Controlling inventory helps businesses avoid the significant expenses associated with overbuying inventory and the stress of operating without it. Even though certain businesses that use just-in-time technique for ordering may have incredibly low inventories, almost every industry needs some sort of inventory, which is best controlled through inventory control systems.

Learn more about Inventory and it's Control here

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