Deck 3: Introduction to Purchasing

Question 1

Why has technology increased productivity for purchasers?

A) You have access to an almost infinite database of products
B) Online ordering eliminates the distance effect
C) Purchasing databases maintain crucial inventory information
D) All answers are correct

Answer 1

D

Question 2

Which factors are most important for determining how you will write your purchase specifications?

A) Best prices available
B) Quality of the goods to be purchased
C) The company's image, menu, prices, and clientele
D) Finding the most unique items that are still reasonably priced

Answer 2

C

Question 3

The ultimate purpose of requesting bids is to compare vendors' products, profiles, and suitability.

Answer 3

True

Question 4

Reducing expenses on labor and overhead is generally much easier and more effective than controlling purchasing costs.

Question 5

Why is it more important to control purchasing expenses than to increase sales an equal amount?

A) Because the purchaser will get bonuses for saving company funds
B) Because the budget is increased by whatever amount is successfully controlled
C) Because all savings through cost control go directly to increase the company's bottom line
D) Controlling purchasing expenses is not really more critical than increasing sales

Question 6

One of the primary objectives of the purchasing department is to procure the best or highest-quality product available.

Question 7

Which of the following is not one of the four elements of a binding contract?

A) Capable parties
B) Mutual assent
C) Lawful objective
D) Fair and equitable exchange

Question 8

Legal and ethical issues are rarely relevant in purchasing decisions.

Question 9

The purchasing agent has only a minimal impact on a restaurant's financial success.

Question 10

Receiving and processing invoices electronically does what for a company?

A) Eliminates the need for employees
B) Eliminates the need for paper copies of the paperwork
C) Decreases the need for review of the data in the invoice
D) Increases the need for technologically adept staff members

Question 11

What are the most important standards that a purchasing manager should maintain when working with vendors?

A) All payments should be made to vendors within fourteen days of receipt of the items
B) All dealings should be standardized, transparent, and ethical
C) All deals should be signed off on by the company's owner
D) Any special bonuses like free items should go to the company's owner

Question 12

Competent purchasing and effective cost control give you your best opportunity to increase profits.

Question 13

Communication between the chef and the purchaser should happen only when the chef explains his or her product needs and the purchaser procures them.

Question 14

Saving $2,000 on purchases in an operation that averages a 4 percent profit margin is equivalent to increasing sales by how much?

A) $8,000
B) $10,000
C) $2,000
D) $20,000

Question 15

A contract is a written and signed agreement between two or more parties that is enforceable by law.

Question 16

The purchaser has a little role in creating or upholding a company's ethical standards.

Question 17

Vendors often provide services beyond just the product. Which of the following is not something you should look for in your vendors?

A) Convenient delivery schedules
B) Free samples for your family to test
C) Reliably sending you the items you request
D) Consistency in the quality of the products

Question 18

The purchasing process must never extend into the kitchen: monitoring how products are used and served will create a hostile relationship with the chef and cooks.

Question 19

Purchasing is an entire process that includes several steps. Which of the following is not one of those steps?

A) Planning the menu and determining the items needed for that menu
B) Determining the product specifications for those items
C) Selecting vendors and purchasing the items
D) Advertising the menu to potential customers

Question 20

What is the primary goal of the purchasing department?

A) Controlling costs and maximizing value
B) Controlling product usage
C) Keeping the products locked up and safe from damage
D) Maintaining a proper inventory at all times

Question 21

When you see unethical behavior in your company, what must you do?

Question 22

Why is it the responsibility of the purchaser to review vendor bids before making appropriate purchasing decisions?

Question 23

What does purchase price include for the purchaser?

Question 24

What is the meaning of inventory turnover?

Question 25

What is inventory target?

Question 26

Why must a contract be lawful?

Question 27

Define purchase specification.

Question 28

Using the Internet to find products is helpful, but checking a vendor's reputation can be even more important when you find that vendor online. Why?

Question 29

What is a purchase order?

Question 30

Can a minor enter into a legally binding contract?