INVENTORY MANAGEMENT Explained By: Sarbjit Kaur. Lecturer, Department of Computer Application, PGG.C.G., Sector: 42, Chandigarh

MEANING OF INVETORY IT is a ‘stock of goods’ or a list of goods. It can be defined as the stock of any item used in an organization. One of the most expensive assets of many companies representing as much as 50% of total invested capital

FOUR TYPES OF INVENTORY (a) Raw materials & parts-These may include all raw materials, components and assemblies used in the manufacture of a product; (b) Consumables & Spares - These may include materials required for maintenance and day-to-day operation; (c) Work in progress - These are items under various stages of production not yet converted as finished goods; (d) Finished Products - Finished goods not yet sold or put into use

INVENTORY ASSOCIATED DOCUMENTS IDENTIFYING FOR MATERIALS : IT IS A FORM USED AS A FORMAL REQUEST TO THE PUCHASING DEPARTMENT TO PURCHASE MATERIAL. PURCHASE ORDER : THE PURCHASE DEPARTMENT PREPAIRES A PURCHASE ORDER FOR THE SUPPLY OF STORES.

CONT’D STORES LEDGER : IT PROVIDES THE INFORMATION FOR THE PRICING. RETURN OF SURPLUS MATERIALS : WHEN EXCESS MATERIAL RETURNED TO STORES , A MATERIAL RETURNED NOTE IS PREPAIRED IN THE DEPARMENT WHERE THE MATERIAL IS IN EXCESS.

VARIOUS COST OF HOLDING INVENTORIES CAPITAL COST STORAGE AND HANDLING COST RISK OF PRICE DECLINE RISK OF OBSOLESCENCE RISK DETERIORATION IN QUALITY

TYPES OF INVENTORY REPORTS INVENTORY PERFORMANCE REPORT LOW STOCK REPORT STOCK MOVEMENT REPORT INVENTORY PURCHASING REPORT OVER STOCK REPORT