. Products and materials maintained in inventory may become obsolete. Therefore, to avoid losses through obsolescence, it is desirable to have materials management and control procedures which insure that stocks are "turned" prior to the development of obsolesence.
4. Inventories are subject to physical deterioration. Depending upon the characteristics of the goods, physical decay or deterioration may occur, while goods are being held in inventory. Thus, to avoid losses through physical deterioration, it is desirable to have materials management and
control procedures which insure that stocks are "turned" prior to the occurrence of physical deterioration.
5. Inventories are subject to theft. The extent to which theft occurs of goods held in inventory depends, to a great extent, on the characteristics of the goods. Most goods, however, are, to some extent, subject to theft. Effective materials management and control procedures will reduce inventory losses due to theft.
6. Inventories are subject price dete
...