Test your basic knowledge |

Inventory Management

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. Often everybody's concern - but nones responsibility






2. Sacrificed in exchange for buying needed machines






3. Single order vs repetitive order






4. Units taken from inventory - can be categorized by: 1) size (magnitude/quality - constant vs variable and deterministic vs unknown vs probabilistic) 2) rate (def size over a period of time) 3) pattern (how demand is withdrawn from inventory - be






5. 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)






6. 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






7. Customers demand for finished goods






8. 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






9. Final product - available for storage - distribution - or sale; isolate the customer from the producer






10. Production does not need to be geared directly to this; it is not faced to adapt to the necessities of production






11. 1) stock of material on hand at a given time (tangible assets that can be seen - measured - and counted) 2) utilized assets waiting for sale of use






12. Purchase - oder cost or set up cost - stock out cost - and inventory holding costs (aka inventory carrying costs)






13. Display inventory carried to increase product visibility stimulate demand






14. Inventory partially completed finished products that are still in the production process; isolate the production departments from one another






15. One firms finished goods may be another firms supplies or raw materials






16. Associated insurance cost - associated taxes






17. Hold only finished goods inventories/supplies - they have inventory problems confined to supplies and finished goods






18. 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






19. Should be in charge of all materials-relatied functions including: purchasing - transportation - storage - production control - and inventory - ; they must be viewed on same level as finance - marketing - engineering - ext






20. Each pool requires synchronization of the rate of flow into and from it - no pool can be controlled without respect to the others - problems in one pool will effect all others - raises question of how much to order at any given time and when to pl






21. 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






22. Allows one part of the system to be isolated from the next






23. Have most complex and difficult inventory problems






24. Time factor - discontinuity factor - uncertainty factor - economy factor






25. Working stock - anticipation stock - safety stock - pipeline stock - decoupling stock - psychic stock






26. The cost for the item as it is laced in inventory - unit purchase cost (if obtained externally and includes delivery and transportation costs) - unit production cost (if made in house and includes labor - material and overhead costs)






27. The cost of issuing a purchase order/placing an order if obtained externally - the cost of setting up production if made in house






28. Cost of the facility - material handling (labor and energy) - maintenance cost - and some utility cost






29. 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)






30. Constant vs variable - independent vs dependent






31. Items consumes in the normal functioning of a firm that are NOT part of the final product; ex: pencils - light bulbs - drill bits - paper






32. Those cost that vary with the amount of inventory in the short run






33. 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






34. Often a lot of conflict when it comes to inventory decisions - sub optimization problems (managers only looking out for their own departments)






35. Capital costs - storage space costs - inventory service cost - inventory risk cost






36. It takes time to make a product - but consumers want them on demand






37. Internal vs external






38. As items are completed - they enter another pool-finihsed goods - this pool must be controlled with regard to external demand






39. As you move up in the supply chain...






40. The cost associated with a foregone alternative use of the capital - that is - the benefits that could have been obtained from that alternative






41. The cost associated with a foregone alternative use of the capital - that is - the benefits that could have been obtained from that alternative - usually the largest component of the inventory carrying cost - usually set to the value of the firms






42. The stock of materials on hand at a given time and the unutilized assets waiting for sale or use






43. Constant vs variable






44. Limitations placed on inventory systems - ex: space constraints - capital - facility - equipment - personal - management policies and administrative decisions






45. Materials are used by manufacturing and fill a second pool of work in process - this pool must be managed in relation to the capacity of the facility






46. Includes cost of obsolescence (equal to the original cost-salavage cost) - damage cost - and shrinkage (theft) cost






47. Minimum rate of return expected on new investments






48. Repetiveness - source of supply - type of demand - type of lead time - type of inventory






49. Demands - replenishments - constraints - and costs






50. Time factor - discontinuity factor - uncertainty factor - and economic factor