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    ABC Analysis Is A Business Term Used To Define An

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    Shaukat Hayat Niazi
    ABC analysis is an inventory categorization technique used to identify items that have a significant impact on overall inventory costs. It groups inventory into three categories - A, B, and C - based on estimated importance. [A] items are very important and require tight control and accurate records. [B] items are important but less so than [A] items. [C] items are marginally important and need the simplest controls.

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    ABC Analysis Is A Business Term Used To Define An

    Uploaded by

    Shaukat Hayat Niazi
    26 views1 page
    ABC analysis is an inventory categorization technique used to identify items that have a significant impact on overall inventory costs. It groups inventory into three categories - A, B, and C - based on estimated importance. [A] items are very important and require tight control and accurate records. [B] items are important but less so than [A] items. [C] items are marginally important and need the simplest controls.

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    ABC Analysis

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    ABC analysis is an inventory categorization technique used to identify items that have a significant impact on overall inventory costs. It groups inventory into three categories - A, B, and C - based on estimated importance. [A] items are very important and require tight control and accurate records. [B] items are important but less so than [A] items. [C] items are marginally important and need the simplest controls.

    Copyright:

    © All Rights Reserved
    Download as DOC, PDF, TXT or read online from Scribd
    Download as doc, pdf, or txt
    26 views1 page

    ABC Analysis Is A Business Term Used To Define An

    Uploaded by

    Shaukat Hayat Niazi
    ABC analysis is an inventory categorization technique used to identify items that have a significant impact on overall inventory costs. It groups inventory into three categories - A, B, and C - based on estimated importance. [A] items are very important and require tight control and accurate records. [B] items are important but less so than [A] items. [C] items are marginally important and need the simplest controls.

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    © All Rights Reserved
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    1.

    ABC Analysis is a business term used to define an inventory


    categorization technique often used in materials management. It is also
    known as Selective Inventory Control. Policies based on ABC analysis
    a. A Items very tight control and accurate records.
    b. B Items less tightly controlled and good records.
    c. C Items sim!lest controls !ossible and minimal records.
    ". #he ABC analysis !rovides a mechanism for identifying items that will
    have a significant im!act on overall inventory cost$ while also !roviding a
    mechanism for identifying different categories of stock that will require
    different management and controls.#he ABC analysis suggests that
    inventories of an organization are not of equal value.
    %"&
    #hus$ the inventory
    is grou!ed into three categories 'A, B, and C( in order of their estimated
    im!ortance.
    ). *A' items are very im!ortant for an organization. Because of the high
    value of these +A, items$ frequent value analysis is required. In addition to
    that$ an organization needs to choose an a!!ro!riate order !attern 'e.g.
    +-ust. in. time,( to avoid e/cess ca!acity.
    *B' items are im!ortant$ but of course less im!ortant than +A, items and
    more im!ortant than +C, items. #herefore +B, items are intergrou! items.
    *C' items are marginally im!ortant.

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