The correct answer is C. Stock taking. Stock taking involves verifying the physical quantities of stores in hand. Let’s provide a detailed explanation of why this answer is correct and then discuss why the other options (A, B, and D) are not accurate descriptions of the process of verifying physical quantities of inventory.

C. Stock Taking (Correct Answer – Verifying Physical Quantities of Inventory):

1. Physical Inventory Count:

Stock taking, also known as physical inventory count or physical inventory audit, is the process of physically counting and verifying the quantity of items in an organization’s inventory. This typically involves counting every item in stock, regardless of its value or location.

2. Accuracy Check:

The primary purpose of stock taking is to ensure that the recorded inventory quantities in an organization’s records match the actual physical quantities on hand. Discrepancies between recorded and physical counts can indicate issues like theft, errors in record-keeping, or damage to inventory items.

3. Frequency:

Stock taking can be performed periodically, such as on an annual or quarterly basis, or as needed based on an organization’s inventory management practices. The frequency of stock taking depends on factors like the nature of the business, inventory turnover rate, and the importance of accuracy in inventory records.

4. Methods:

Stock taking can be conducted using various methods, including manual counting, barcode scanning, RFID (Radio-Frequency Identification) technology, or automated inventory management systems. The chosen method depends on the organization’s resources, technology, and the complexity of its inventory.

5. Reconciliation:

After completing the physical count, the recorded inventory levels are compared to the actual quantities counted during stock taking. Any discrepancies are investigated and reconciled to bring the inventory records in line with the physical inventory on hand.

Now, let’s explore why the other options are not accurate descriptions of the process of verifying physical quantities of inventory:

A. Pricing of Issues (Not Correct):

“Pricing of issues” refers to the process of determining the cost or price of items that are issued from inventory. It involves assigning a value to the inventory items when they are used or sold. While pricing of issues is an important aspect of inventory management, it does not directly involve verifying the physical quantities of inventory. Instead, it focuses on the financial aspect of inventory valuation.

B. Material Control (Not Correct):

Material control encompasses various activities related to managing inventory, including procurement, storage, distribution, and tracking of materials or goods. While material control is a critical component of inventory management, it is a broader concept that goes beyond the specific task of physically counting and verifying inventory quantities.

D. None (Not Correct):

Selecting “None” as the answer is not accurate because the correct answer is “C. Stock taking.” Stock taking is a recognized and essential process for verifying the physical quantities of inventory in an organization. It is a standard practice used to ensure the accuracy of inventory records and maintain control over inventory levels.

In summary, stock taking is the correct process for verifying the physical quantities of stores or inventory in hand. It involves physically counting and reconciling the actual quantities of inventory items with the recorded quantities in an organization’s records.

While other activities like pricing of issues, material control, and inventory management are vital components of overall inventory management, they are distinct from the specific task of stock taking, which focuses on physical inventory verification and accuracy.