Question

In the context of inventory classification, the term annual usage refers to which of the following?

a) the product of annual sales (in units) and unit costs
b) the amount of energy needed to store a particular item in inventory for one year
c) the percentage of a product's inventory that is sold within a year
d) the share of a firm's total SKU (stock keeping unit) count that is sold at least once a year

Answer 1

Annual usage in the context of inventory classification refers to the percentage of a product's inventory that is sold within a year.

Step-by-step explanation:

In the context of inventory classification, the term annual usage refers to option c) the percentage of a product's inventory that is sold within a year. This is a measure of how quickly a product is being sold and helps businesses manage their inventory levels. It is calculated by dividing the number of units sold within a year by the average inventory level for that year, and then multiplying by 100.