Question

When performing Cycle Counts, which type should you complete first?

1) Random Cycle Counts
2) ABC Cycle Counts
3) Physical Cycle Counts
4) Systematic Cycle Counts

Answer 1

ABC cycle counts are typically performed first in inventory management due to their categorization of items by value, which allows companies to focus on the most important items first.

Step-by-step explanation:

When deciding which type of cycle count to perform first, it is generally best practice to start with ABC cycle counts. This method categorizes inventory into three groups (A, B, and C) based on their importance, with 'A' items being the most valuable, 'B' items of moderate value, and 'C' items being the least valuable. Companies typically count 'A' items more frequently because they have the most significant financial impact on inventory accuracy and business operations. So, an ABC cycle count is often prioritized over random, physical, or systematic counts.