In ABC analysis, which categories are used to classify inventory by value?

• A. Frontline, midline, backline
• B. A (high value), B (moderate), C (low value)
• C. Essential, important, optional
• D. Gold, silver, bronze

Answer: (B)

ABC analysis groups inventory by how much each item contributes to value, using three categories: high-value items, moderate-value items, and low-value items. This approach follows the idea that a small portion of items often drives most of the total value, so you apply tighter controls and closer monitoring to those high-value items while managing low-value items more simply. The option that describes these three labels—high value, moderate value, and low value—fits this concept perfectly. The other naming schemes don’t reflect how ABC analysis classifies items by their value contribution.