Examples of supply vs. demand in the following topics:
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Calculating Fair Value
- Calculating fair value involves considering objective factors including acquisition, supply vs. demand, actual utility, and perceived value.
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Accounting Methodologies: Amortized Cost, Fair Value, and Equity
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Current Ratio
- The ratio is an indication of a firm's market liquidity and ability to meet creditor's demands.
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Nature of Inventory
- Inventories are maintained as buffers to meet uncertainties in demand, supply, and movements of goods.
- Most large manufacturing and merchandising companies use this system to ensure adequate supplies are on hand for production or sale, and to minimize costly machine shut-downs and customer complaints.
- Time - The time lags present in the supply chain, from supplier to user at every stage, requires that you maintain certain amounts of inventory to use in this lead time.
- Uncertainty - Inventories are maintained as buffers to meet uncertainties in demand, supply and movements of goods.