Question 1

The four categories of inventory are raw materials, intermediate assemblies, work-in-progress and finished goods.

Accepted Answer

A) True 
 B)False  False

Question 2

Lubricants for production equipment which are not parts of the final products are called:

Accepted Answer

A)  Raw materials 
B)  Work-in-process 
C)  Maintenance, repair and operating supplies 
D)  Finished goods 
E)  Cycle stock 
A)  Raw materials 
B)  Work-in-process 
C)  Maintenance, repair and operating supplies 
D)  Finished goods 
E)  Cycle stock C

Question 3

Radio Frequency Identification (RFID) is beginning to replace bar code inventory tracking, however a weakness is that it requires a direct line of sight for RFID tags to be read.

Accepted Answer

A) True 
 B)False  False

Question 4

The College Bookstore sells a unique calculator to college students.The demand for this calculator has a normal distribution with an average daily demand of 20 units and a standard deviation of 4 units per day.The lead time for this calculator is 9 days.Compute the statistical reorder point that results in a 95 percent in-stock probability.Choose the closest answer.

Accepted Answer

A)  20 units 
B)  80 units 
C)  180 units 
D)  200 units 
E)  420 units 
A)  20 units 
B)  80 units 
C)  180 units 
D)  200 units 
E)  420 units

Question 5

Classify the following inventory items as either A, B, or C items using the ABC inventory control system:

Accepted Answer

A)  item 1 (
C) , item 2 (
A) , item 3 (
C) , item 4 (
B) , item 5 (
C)  
B)  item 1 (
B) , item 2 (
A) , item 3 (
A) , item 4 (
C) , item 5 (
C)  
C)  item 1 (
C) , item 2 (
B) , item 3 (
C) , item 4 (
A) , item 5 (
C)  
D)  item 1 (
A) , item 2 (
B) , item 3 (
C) , item 4 (
A) , item 5 (
B)  
E)  item 1 (
B) , item 2 (
C) , item 3 (
B) , item 4 (
C) , item 5 (
A)  
A)  item 1 (
C) , item 2 (
A) , item 3 (
C) , item 4 (
B) , item 5 (
C)  
B)  item 1 (
B) , item 2 (
A) , item 3 (
A) , item 4 (
C) , item 5 (
C)  
C)  item 1 (
C) , item 2 (
B) , item 3 (
C) , item 4 (
A) , item 5 (
C)  
D)  item 1 (
A) , item 2 (
B) , item 3 (
C) , item 4 (
A) , item 5 (
B)  
E)  item 1 (
B) , item 2 (
C) , item 3 (
B) , item 4 (
C) , item 5 (
A)

Question 6

The College Bookstore sells a unique calculator to college students.The demand for this calculator is constant at 20 units per day.The lead time for this calculator is variable at an average of 9 days with a standard deviation of 2 days.Compute the statistical reorder point that results in a 95 percent in-stock probability.Choose the closest answer.

Accepted Answer

A)  26 units 
B)  46 units 
C)  182 units 
D)  226 units 
E)  246 units 
A)  26 units 
B)  46 units 
C)  182 units 
D)  226 units 
E)  246 units

Question 7

If your company had an annual purchase cost of items equal to $2,000,000, an annual holding cost of $150,000 and an annual ordering cost of $50,000 this scenario would reveal that:

Accepted Answer

A)  Your order size was lower than the EOQ 
B)  Your order lot size was equal to the EOQ 
C)  Your order lot size was higher than the EOQ 
D)  Nothing because there is insufficient information to discern where the EOQ would be. 
A)  Your order size was lower than the EOQ 
B)  Your order lot size was equal to the EOQ 
C)  Your order lot size was higher than the EOQ 
D)  Nothing because there is insufficient information to discern where the EOQ would be.

Question 8

If at the end of the year, the cost of revenue = $2,500, total revenue = $12,000 and inventory value = $2,000, the inventory turnover ratio would be:

Accepted Answer

A)  0.208 
B)  0.375 
C)  2.667 
D)  0.800 
E)  1.250 
A)  0.208 
B)  0.375 
C)  2.667 
D)  0.800 
E)  1.250

Question 9

The economic order quantity model (EOQ) is the optimal independent demand order quantity that minimizes total annual inventory costs.

Accepted Answer

A) True 
 B)False

Question 10

The inventory turnover ratio shows how efficiently a firm is using its inventory to generate revenue.

Accepted Answer

A) True 
 B)False

Question 11

The ABC inventory matrix combines two ABC analyses-one is based on current inventory valuation and the other is based on annual inventory dollar usage..

Accepted Answer

A) True 
 B)False

Question 12

Which of the following would refer to the 80/20 rule when applied to the ABC inventory control system?

Accepted Answer

A)  80 percent of the items account for 20 percent of the groups. 
B)  20 percent of the items account for 80 percent of the tasks. 
C)  80 percent of the unit cost accounts for 20 percent of the items. 
D)  80 percent of the total annual $ usage is accounted for, by 20 percent of the items. 
E)  None of these. 
A)  80 percent of the items account for 20 percent of the groups. 
B)  20 percent of the items account for 80 percent of the tasks. 
C)  80 percent of the unit cost accounts for 20 percent of the items. 
D)  80 percent of the total annual $ usage is accounted for, by 20 percent of the items. 
E)  None of these.

Question 13

Which of the following describes a global RFID challenge?

Accepted Answer

A)  Foreign firms will not use global RFID since the field communication standards tend to vary from country to country. 
B)  Globally, the RFID industry does not have its own UHF spectrum allocation. 
C)  RFID tags are passive in undeveloped countries. 
D)  RFID can track outbound shipments only. 
E)  All of the above. 
A)  Foreign firms will not use global RFID since the field communication standards tend to vary from country to country. 
B)  Globally, the RFID industry does not have its own UHF spectrum allocation. 
C)  RFID tags are passive in undeveloped countries. 
D)  RFID can track outbound shipments only. 
E)  All of the above.

Question 14

Name and briefly explain the four basic types of inventory.

Accepted Answer

a.Raw materials -unprocessed, purchased

Question 15

Use the information below to calculate the number of orders per year when using the EOQ:  
Choose the closest answer.

Accepted Answer

A)  49 
B)  81 
C)  123 
D)  202 
A)  49 
B)  81 
C)  123 
D)  202

Question 16

Steering wheels purchased by Ford are an example of dependent demand.

Accepted Answer

A) True 
 B)False

Question 17

What is Radio Frequency Identification (RFID)? Provide four examples or scenarios of how RFID can be used to aid in supply chain management.

Accepted Answer

RFID aids in inventory management by mak

Question 18

Which of the following is TRUE regarding the EOQ figure below?

Accepted Answer

A)  Curve J represents the annual ordering cost, and curve L represents the annual holding cost. 
B)  A lot size of G has an annual total cost of about C. 
C)  At lot size H both holding costs and ordering costs exceed the annual total cost. 
D)  The EOQ is at lot size G, and curve K is the annual holding cost curve. 
A)  Curve J represents the annual ordering cost, and curve L represents the annual holding cost. 
B)  A lot size of G has an annual total cost of about C. 
C)  At lot size H both holding costs and ordering costs exceed the annual total cost. 
D)  The EOQ is at lot size G, and curve K is the annual holding cost curve.

Question 19

Pareto Analysis means that 20 percent of the items get about 80 percent of the safety stock.

Accepted Answer

A) True 
 B)False

Question 20

In the economic manufacturing quantity model (EMQ), the annual consumption rate must be less than the annual production rate.

Accepted Answer

A) True 
 B)False

The four categories of inventory are raw materials, intermediate assemblies, work-in-progress and finished goods.

Lubricants for production equipment which are not parts of the final products are called:

Radio Frequency Identification (RFID) is beginning to replace bar code inventory tracking, however a weakness is that it requires a direct line of sight for RFID tags to be read.

Classify the following inventory items as either A, B, or C items using the ABC inventory control system:

If your company had an annual purchase cost of items equal to $2,000,000, an annual holding cost of $150,000 and an annual ordering cost of $50,000 this scenario would reveal that:

If at the end of the year, the cost of revenue = $2,500, total revenue = $12,000 and inventory value = $2,000, the inventory turnover ratio would be:

The economic order quantity model (EOQ) is the optimal independent demand order quantity that minimizes total annual inventory costs.

The inventory turnover ratio shows how efficiently a firm is using its inventory to generate revenue.

The ABC inventory matrix combines two ABC analyses-one is based on current inventory valuation and the other is based on annual inventory dollar usage..

Which of the following would refer to the 80/20 rule when applied to the ABC inventory control system?

Which of the following describes a global RFID challenge?

Name and briefly explain the four basic types of inventory.

Use the information below to calculate the number of orders per year when using the EOQ: Choose the closest answer.

Steering wheels purchased by Ford are an example of dependent demand.

What is Radio Frequency Identification (RFID)? Provide four examples or scenarios of how RFID can be used to aid in supply chain management.

Which of the following is TRUE regarding the EOQ figure below?

Pareto Analysis means that 20 percent of the items get about 80 percent of the safety stock.

In the economic manufacturing quantity model (EMQ), the annual consumption rate must be less than the annual production rate.

Introduction to Supply Chain Management

Purchasing Management

Creating and Managing Supplier Relationships

Ethical and Sustainable Sourcing

Demand Forecasting

Resource Planning Systems

Process Management: Lean and Six Sigma in the Supply Chain

Domestic U.S.and Global Logistics

Customer Relationship Management

Global Location Decisions

Service Response Logistics

Supply Chain Process Integration

Performance Measurement Along the Supply Chain

Filters

Exam 7: Inventory Management

The four categories of inventory are raw materials, intermediate assemblies, work-in-progress and finished goods.

Lubricants for production equipment which are not parts of the final products are called:

Radio Frequency Identification (RFID) is beginning to replace bar code inventory tracking, however a weakness is that it requires a direct line of sight for RFID tags to be read.

Classify the following inventory items as either A, B, or C items using the ABC inventory control system:

If your company had an annual purchase cost of items equal to $2,000,000, an annual holding cost of $150,000 and an annual ordering cost of $50,000 this scenario would reveal that:

If at the end of the year, the cost of revenue = $2,500, total revenue = $12,000 and inventory value = $2,000, the inventory turnover ratio would be:

The economic order quantity model (EOQ) is the optimal independent demand order quantity that minimizes total annual inventory costs.

The inventory turnover ratio shows how efficiently a firm is using its inventory to generate revenue.

The ABC inventory matrix combines two ABC analyses-one is based on current inventory valuation and the other is based on annual inventory dollar usage..

Which of the following would refer to the 80/20 rule when applied to the ABC inventory control system?

Which of the following describes a global RFID challenge?

Name and briefly explain the four basic types of inventory.

Use the information below to calculate the number of orders per year when using the EOQ: Choose the closest answer.

Steering wheels purchased by Ford are an example of dependent demand.

What is Radio Frequency Identification (RFID)? Provide four examples or scenarios of how RFID can be used to aid in supply chain management.

Which of the following is TRUE regarding the EOQ figure below?

Pareto Analysis means that 20 percent of the items get about 80 percent of the safety stock.

In the economic manufacturing quantity model (EMQ), the annual consumption rate must be less than the annual production rate.

Introduction to Supply Chain Management

Purchasing Management

Creating and Managing Supplier Relationships

Ethical and Sustainable Sourcing

Demand Forecasting

Resource Planning Systems

Process Management: Lean and Six Sigma in the Supply Chain

Domestic U.S.and Global Logistics

Customer Relationship Management

Global Location Decisions

Service Response Logistics

Supply Chain Process Integration

Performance Measurement Along the Supply Chain

Filters