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Test your basic knowledge |
Inventory Management
Start Test
Study First
Subject
:
business-skills
Instructions:
Answer 50 questions in 15 minutes.
If you are not ready to take this test, you can
study here
.
Match each statement with the correct term.
Don't refresh. All questions and answers are randomly picked and ordered every time you load a test.
This is a study tool. The 3 wrong answers for each question are randomly chosen from answers to other questions. So, you might find at times the answers obvious, but you will see it re-enforces your understanding as you take the test each time.
1. Demands - replenishments - constraints - and costs
Major properties of inventory
Reasons why inventory exists
Type of inventory system
Initial phase of inventory flow
2. Hold only finished goods inventories/supplies - they have inventory problems confined to supplies and finished goods
Retailers - wholesalers - and distributors
In-Proccess Goods
Inventory flow
The categorization of inventory by the purpose that it serves
3. It takes time to make a product - but consumers want them on demand
Time Factor
External shortage
Reasons why inventory exists
Basic types of inventory
4. The cost associated with the money tied up in inventory and the cost associated with maintaining it in storage - usually expresses as a percentage of items value
Inventory service cost
Pipeline stock
Inventory carrying cost
Psychic stock
5. Includes cost of obsolescence (equal to the original cost-salavage cost) - damage cost - and shrinkage (theft) cost
Less inventory
Inventory risk cost
Raw Materials Inventory
Basic types of inventory
6. Minimum rate of return expected on new investments
Reasons why inventory exists
Inventory carrying cost
Internal shortage
Hurdle rate
7. One firms finished goods may be another firms supplies or raw materials
Onventory management
Inventory management
Cost accumulation
Classification of Inventory item
8. Gives firms a competitive advantage due to lower costs and greater flexibility
Major components of inventory carrying cost
Less inventory
Economic Factors
Types of inventory
9. Demands - replenishments - - constraints - and costs
Cost accumulation
Basic types of inventory
Properties of inventory
Material costs
10. Fewer department conflicts - less sub optimization - consolidation of activities - single source of accountability
Benefits of inventory/material manager
Sub goals of inventory management
Second phase
Hurdle rate
11. Run out of material or supplies - production stopping - deadlines not met
Internal shortage
Types of inventory
Retailers - wholesalers - and distributors
Source of supply
12. Associated insurance cost - associated taxes
Consumption
Inventory risk cost
Types of inventory
Inventory service cost
13. Internal vs external
Onventory management
Contraints
Functional factors to explain why inventory exists
Source of supply
14. Production does not need to be geared directly to this; it is not faced to adapt to the necessities of production
Inventory management
Consumption
Onventory management
Raw Materials Inventory
15. Often divided up over all departments each with its own agenda: purchasing-raw materials and purchased items - manufacturing-work in progress - marketing-finished goods and distribution - it is usually best to give responsibility for all inventory
Storage space costs
Type of inventory system
Additional phases
Responsibility
16. Capital costs - storage space costs - inventory service cost - inventory risk cost
Properties of inventory
Costs
Inventory risk cost
Major components of inventory carrying cost
17. Goods are purchased from suppliers and the first pool of inventory investment that need management forms - the quantity and variety of items in the pool should be times to meet the need for their use by the firm
Manufacturers
Major properties of inventory
Properties of inventory
Initial phase of inventory flow
18. The economic consequences of an internal or external shortage - vary greatly between items and customers - very difficult to estimate - most firms avoid messing with this by specifying customer service levels
Retailers - wholesalers - and distributors
Anticipation stock (seasonal stock)
Cost accumulation
Stock out costs
19. Constant vs variable - independent vs dependent
In-Proccess Goods
Type of demand
Purchase costs
Types of inventory
20. If the firm uses a warehouse or distributor centers - there must be additional pools of finished inventory
Repetiveness
Additional phases
Different departments in a firm
Manufacturers
21. As you move up in the supply chain...
Retailers - wholesalers - and distributors
Inventory service cost
Types of inventory
Problems become more complex
22. What purpose does inventory serve? working stock - anticipation stock (seasonal stock) - safety (buffer) stock - pipeline stock - decoupling stock - psychic stock
Major components of inventory carrying cost
Capital cost
Onventory management
Functional classifications
23. Display inventory carried to increase product visibility stimulate demand
Goals of inventory management
Classifying inventory problems
Psychic stock
Contraints
24. Cost of the facility - material handling (labor and energy) - maintenance cost - and some utility cost
Less inventory
Purchasing discounts
Growing companies
Storage space costs
25. Allows freedom of operation for members of the supply chain; allows the treatment of various dependent operations (ex: retailing - warehousing - manufacturing - and purchasing) in an independent and economical manor
Problems become more complex
Supplies inventory
Discontinuity Factor
Purchasing discounts
26. Units put into inventory - can be classified by: size - pattern - lead time (time between order and addition to inventory - constant vs variable)
Functional classifications
Replenishments
Demands
Retailers - wholesalers - and distributors
27. The cost of issuing a purchase order/placing an order if obtained externally - the cost of setting up production if made in house
Order cost or set up cost
Inventory service cost
Classification of Inventory item
Time Factor
28. Have most complex and difficult inventory problems
Discontinuity Factor
Material costs
Inventory holding costs
Manufacturers
29. Often short on cash because what little they have they devote to growth
Discontinuity Factor
Finished Goods Inventory
Growing companies
Working stock (cycle stock)
30. 1) minimize inventory investment 2) maximize customer service 3) assure efficient plant operation
Goals of inventory management
Psychic stock
Material costs
Order cost or set up cost
31. Protection from the unexpected (forecast errors - break downs - strikes - disasters)
Inventory/materials manager
Uncertainty Factors
Cost accumulation
Inventory risk cost
32. Those cost that vary with the amount of inventory in the short run
Classification of Inventory item
Additional phases
Storage space
Capital cost
33. Working stock - anticipation stock - safety stock - pipeline stock - decoupling stock - psychic stock
Inventory management
Growing companies
Supplies inventory
The categorization of inventory by the purpose that it serves
34. As items are completed - they enter another pool-finihsed goods - this pool must be controlled with regard to external demand
Onventory management
Type of lead time
Third phase
External shortage
35. Repetiveness - source of supply - type of demand - type of lead time - type of inventory system
Inventory flow
Manufacturers
Classifying inventory problems
Functional classifications
36. Inventory partially completed finished products that are still in the production process; isolate the production departments from one another
In-Proccess Goods
Time Factor
Internal shortage
Source of supply
37. Supplies - raw materials - in-processed goods - finished goods
Storage space
Types of inventory
Finished Goods Inventory
Sub goals of inventory management
38. Inventory held in reserve to protect against uncertainty - reasons for carrying: uncertainty around customer demand - delays or disruptions in supply
Safety stock (buffer stock)
Types of inventory costs
Sub goals of inventory management
Inventory service cost
39. Single order vs repetitive order
Inventory risk cost
External shortage
Growing companies
Repetiveness
40. The stock of materials on hand at a given time and the unutilized assets waiting for sale or use
Inventory management
Capital cost
Benefits of inventory/material manager
Inventory service cost
41. Low unit cost - high inventory turnover - consistency of quality - favorable supplier relations - continuity of supply - these goals of inventory management are in many ways in direct conflict
Types of inventory
Type of inventory system
Demands
Sub goals of inventory management
42. Balance is key - concentration may be on one objective at certain times and on another at other times depending on needs of the firm - company policy should emphasize the need to focus on the total cost to the firm - bad idea to have lots of cash
Initial phase of inventory flow
Basic types of inventory
Cost accumulation
Uncertainty Factors
43. Often everybody's concern - but nones responsibility
Psychic stock
Discontinuity Factor
Onventory management
Hurdle rate
44. The cost associated with the money tied up in inventory and the cost associated with maintaining it in storage - usually expressed as a percentage of items value - includes capital costs - storage space costs - inventory service costs and invento
Additional phases
Replenishments
Inventory holding costs
Consumption
45. 1) difficulties in synchronizing supply and demand (supply and demand often differ in the rates at which they provide and require stock) 2) material-related operations take time (goods cannot be produced the instant demand occurs)
Inventory flow
Costs
Decoupling stock
Reasons why inventory exists
46. Includes associated insurance cost (ex insurance for fire and theft) and associated taxes ( can vary substantially from location to location - as much as 0% to 20% of value of goods held in inventory)
Manufacturers
Decoupling stock
How are inventory problems classified
Inventory service cost
47. Involves controlling the flow of materials into and out of a system - a big timing problem
Inventory management
Benefits of inventory/material manager
Types of inventory costs
Anticipation stock (seasonal stock)
48. Externally (aka supply line inventory)-orders place but not yet received (orders being processed and orders in transit) - internally-work in progress - reasons for carrying: time/distance - work in process inventory
Type of lead time
Pipeline stock
Inventory risk cost
Types of inventory
49. Allows one part of the system to be isolated from the next
Decoupling stock
Internal shortage
In-Proccess Goods
Types of inventory costs
50. Inventory build up to cope with expected changes; reasons for carrying: seasonal surges - promotional items - scheduled stoppage - seasonal disruptions (weather - supply - ect) - other expected issues (possible labor shortages during contract n
Safety stock (buffer stock)
Storage space
Anticipation stock (seasonal stock)
Replenishments