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inventory is an asset and has book value

inventory is an asset and has book value.

In your accounting courses you learned that inventory is an asset and has book value increasing the overall worth of a company. When looking at the ability of a company to pay its bills, outsiders often look at the current ratio which takes current assets (cash, accounts receivable, and inventory) and divides it by current liabilities (accounts payable, current portion of long-term debt, and taxes payable). The higher the value, the better able a company is able to pay its bills. Yet in such processes as CPFR and JIT inventory systems, operations management will consider inventory as a liability, or something that improves the profitability of the company by reducing inventory. Is inventory an asset or a liability?Defend your position. What are the pros and cons of a Just-in-Time (JIT) inventory system? Where would it be most effective? When would it be a poor strategic choice? Explain A common tool used in strategic planning is the S.W.O.T. analysis. Pick a company you are familiar with and complete a SWOT analysis for it describing 5 each of Strengths, Weaknesses, Opportunities and Threats. How can a SWOT analysis help a company develop a strategic plan that will be successful? Describe the four functions of management. What role do these play in the strategic decision making process?

inventory is an asset and has book value

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