Question

One characteristic of a just-in-time (JIT) inventory system is that :_______

a. a firm has an ample buffer stock of inventory.
b. the working capital a company needs to finance inventory increases is high.
c. a company is more likely to have excess unsold inventory to write off against earnings.
d. parts enter the manufacturing process immediately; they are not warehoused.
e. it is difficult to spot and fix defective inputs.

Answer 1

Answer:

d. parts enter the manufacturing process immediately; they are not warehoused.

Explanation:

The Just in Time inventory system is one where the management of a business increases efficiency and reduces inventory cost by obtaining raw materials for the production process just as they are needed.

This implies warehousing of unused raw materials is at a minimum. Thereby reducing warehousing cost.

So the option most close to JIT inventory method is - parts enter the manufacturing process immediately; they are not warehoused.

This method also requires accurate forecasting get what is actually needed per time.