Which is the basis of ABC analysis in inventory control?

Correct option is B

Ans. (b)
Sol. ABC analysis categorizes inventory based on the annual consumption value, helping prioritize items for efficient control.
Explanation of each option:
· (a) Criticality of items – Used in VED analysis, not ABC.
· (b) Annual consumption value – Correct answer. Core principle of ABC analysis.
· (c) Procurement difficulty – Not a deciding factor in ABC.
· (d) Unit cost – Not the sole basis, it's multiplied with quantity for ABC.