GMGT 2060 Lecture Notes - Lecture 6: Ratio Decidendi

Which of the following statements about ABC analysis is true? 

a. ABC analysis is based on the presumption that controlling the few most important items produces the vast majority of inventory savings. 

b. In ABC analysis, "C" Items are tightly controlled, have accurate records, and receive regular reviews by major decision-makers. 

c. In ABC analysis, "A" Items have minimal records, periodic review, and simple controls.

d. ABC analysis is based on the presumption that all items must be tightly controlled to produce important cost savings. 

e. All of the above statements are true.