"Inventories" Please respond to the following:
Imagine you are accountable for a franchise fast-food restaurant. Evaluate the best method of inventory costing and make a recommendation to the company’s leaders about why it is best suited for your franchise fast-food restaurant to reduce the possibility of employee theft of product or other shrinkage concerns.
Inventory control requires constant attention. Propose a set of guidelines that reflect the necessary monitoring controls for three distinct types of business (e.g., a shoe retailer, a physician’s office, and a food vending truck) to minimize loss and waste. Indicate how each control will minimize risk of inventory loss
There are three kinds of valuation methods available: first in first out (FIFO); last in first out (LIFO); and average cost (Weygandt, Kimmel, &Kieso, 2012). Restaurants usually use just-in-time inventory methods to because they make the food just in time for the customers to eat it. Based on that I would recommend LIFO. A restaurant does not want to make more food than it will sell because then they are producing waste. They also want to only serve the freshest food.
As a shoe retailer, I would avoid excess inventory costs by ensuring that we have turnover of our goods through cost control processes such as sales, buy one get one free, etc. As a physician’s office I would be concerned with my inventory of supplies, expiration dates, and the control of biological hazardous goods. I