Top Highlights

• 4) Maintenance, Repair, and Operating (MRO) Inventory: MRO inventory refers to items used to maintain and repair machinery, equipment, and other items used in the production process. This type of inventory includes items such as spare parts, tools, and other items needed to maintain and repair production equipment.
• Safety Stock Inventory: Safety stock inventory is a type of inventory kept on hand to ensure that the company can continue to operate in the event of unexpected demand or supply chain disruptions. This type of inventory helps to prevent stockouts and ensure that the company can meet customer demand.
• Slow-Moving Inventory: Slow-moving inventory refers to items that are not selling quickly and are taking up valuable storage space.
• Cost flow assumptions refer to the methods used by businesses to assign costs to inventory items, determining their value for financial reporting purposes.
• There are three commonly used cost flow assumptions: First-In, First-Out (FIFO), Last-In, First-Out (LIFO), and Average Cost.