A Disadvantage Of The Fixed Period Inventory System Is That

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Thus foc needs higher level of safety stock. Foq is more sensitive to demand fluctuations and can respond more quickly to unpredictable demand behaviour. Foc is more suitable when. Some inventory management systems such as the fixed order period system compels a periodic review of all items.

Add your answer and earn points. A faster inventory system enables companies to react faster to supply and demand of the market. The periodic inventory system is a way to track your inventory. The fixed period ordering is an inventory control system, wherein the order for the replenishment of inventory items is sent periodically or after a fixed time interval. The value of the inventory is a component of the financial statements. A perpetual inventory system avoids the delay in the preparation of financial statements as the count of. This system is responsible for ordering and receipt of materials, timing the order placement and keeping record of what has been ordered, how much ordered and from whom the order. It involves higher ordering costs than the fixed quantity inventory system b. Additional inventory records are requiredc.