Describe vendor-managed inventory (VMI). How is it related to outsourcing? Cite an example from your experiences as a shopper
What will be an ideal response?
In vendor-managed inventory, the supplier maintains material for the buyer, often delivering directly to the buyer's using department. It is a form of outsourcing, because the buying firm has transferred the shipping, stocking, and receiving tasks to an external vendor. There are many instances of VMI in today's retail model, e.g., shelves of snack foods and soft drinks are routinely managed by the distributor, not the retailer.
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At the beginning of 2017, Elixir, Inc has the following account balances
Accounts Receivable $40,000 (debit balance) Allowance for Bad Debts $5,000 (credit balance) Bad Debts Expense $0 During the year, credit sales amounted to $850,000. Cash collected on credit sales amounted to $760,000, and $18,000 has been written off. At the end of the year, the company adjusted for bad debts expense using the percent-of-sales method and applied a rate, based on past history, of 2.5%. The ending balance in the Allowance for Bad Debts is ________. A) $5,000 B) $3,250 C) $6,000 D) $8,250
Which statement is true with regard to insurance ratemaking?
I. Rates are calculated by people known as adjustors. II. An insurer doesn't know when insurance is sold if the premium charged is (a) I only (b) II only (c) both I and II (d) neither I nor II