Question

What are four areas in the procurement subsystem?

How are receiving, storage, and inventory linked with
purchasing?

Answer 1

The four areas in the procurement subsystem are supplier selection and management, order processing, receipt and inspection of goods, and payment processing and financial control. Receiving, storage, and inventory are linked with purchasing through the process of physically accepting goods, storing them, and maintaining inventory levels.

Step-by-step explanation:

The four areas in the procurement subsystem are:

1. Supplier selection and management
2. Order processing
3. Receipt and inspection of goods
4. Payment processing and financial control

Receiving, storage, and inventory are linked with purchasing as follows:

• Receiving: This is the process of physically accepting the goods that have been ordered. It involves checking the items for any damages or discrepancies.
• Storage: Once the goods are received, they need to be stored in an appropriate location until they are needed. Proper storage ensures the goods are protected and accessible.
• Inventory: Inventory refers to the stock of goods that a company has on hand. It is closely related to purchasing as inventory levels need to be maintained to meet the demand.