inventory provision policy

z o.o. It will impact the current provision overbalance. The used of a fixed reorder interval is helpful to firms that cannot keep track of their inventory level in real time or who prefer to issue orders to suppliers at scheduled intervals. The (Min, Max) policy also operates with a smaller average number of units on hand. Also, note that, while the order size would be adequate to return the inventory level to S if replenishment were immediate, in practice there will be some replenishment delay during which time the inventory continues to drop, so the inventory level will rarely reach all the way up S. Continuous review, fixed order quantity policy (Reorder Point, Order Quantity). It helps management to allocate the inventory loss over its life and prevent the impact on any specific accounting period. Thus orders sizes must be either 20, 25, 30, 35, etc. G6s3tmvSSWYHW4r;~IEYFY>t:'aIDJ@s c9#T#BQDn,-0]fagfK-LA.:D\!cX:KC=34}@ T To make the right decision, youll need to know how each of these approaches are designed to work and the advantages and limitations of each approach. /PageMode /UseNone Inventory cost can be expressed either as inventory investment or inventory operating cost.