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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. Time factor - discontinuity factor - uncertainty factor - economy factor
The categorization of inventory by reasons for its existence
Storage space costs
Onventory management
Functional factors to explain why inventory exists
2. Sacrificed in exchange for buying needed machines
Third phase
Problems become more complex
Purchasing discounts
Contraints
3. 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)
In-Proccess Goods
Contraints
Inventory flow
Purchase costs
4. Includes cost of obsolescence (equal to the original cost-salavage cost) - damage cost - and shrinkage (theft) cost
Inventory risk cost
External shortage
Capital costs (opportunity costs)
Less inventory
5. Constant vs variable
Capital cost
Type of lead time
Consumption
Raw Materials Inventory
6. Allows one part of the system to be isolated from the next
Major properties of inventory
Decoupling stock
Problems become more complex
Type of inventory system
7. Supplies - raw materials - in process goods - and finished goods
Basic types of inventory
Consumption
Discontinuity Factor
Benefits of inventory/material manager
8. 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
Inventory/materials manager
Goals of inventory management
Inventory service cost
Less inventory
9. 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
Inventory flow
Inventory carrying cost
Replenishments
Consumption
10. Inventory held in reserve to protect against uncertainty - reasons for carrying: uncertainty around customer demand - delays or disruptions in supply
Inventory carrying cost
Growing companies
Inventory service cost
Safety stock (buffer stock)
11. The cost of issuing a purchase order/placing an order if obtained externally - the cost of setting up production if made in house
Third phase
Order cost or set up cost
Functional factors to explain why inventory exists
Driving force behind the flow
12. Constant vs variable - independent vs dependent
Type of demand
The categorization of inventory by reasons for its existence
Purchasing discounts
Growing companies
13. Customers demand for finished goods
Type of lead time
Driving force behind the flow
Major components of inventory carrying cost
Inventory
14. It takes time to make a product - but consumers want them on demand
How are inventory problems classified
Inventory
Time Factor
Costs
15. 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
Storage space costs
Inventory flow
Capital costs (opportunity costs)
Supplies inventory
16. Cost of obsolescence - damage cost - shrinkage (theft) cost
Major properties of inventory
Inventory risk cost
Initial phase of inventory flow
Major components of inventory carrying cost
17. Inventory held in advance of requirements - reasons for carrying: economies of scale (or batching economies) - price (quantity) discounts - transportation rates - production economies
Consumption
Safety stock (buffer stock)
Working stock (cycle stock)
Sub goals of inventory management
18. Units put into inventory - can be classified by: size - pattern - lead time (time between order and addition to inventory - constant vs variable)
Replenishments
Cost accumulation
Economic Factors
Inventory management
19. 1) minimize inventory investment 2) maximize customer service 3) assure efficient plant operation
Benefits of inventory/material manager
Purchasing discounts
The categorization of inventory by reasons for its existence
Goals of inventory management
20. Internal vs external
The categorization of inventory by reasons for its existence
Source of supply
Finished Goods Inventory
Inventory risk cost
21. Often short on cash because what little they have they devote to growth
In-Proccess Goods
Raw Materials Inventory
Growing companies
Demands
22. 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
Working stock (cycle stock)
The categorization of inventory by reasons for its existence
Inventory
Material costs
23. 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
Type of demand
Inventory carrying cost
Stock out costs
Different departments in a firm
24. Supplies - raw materials - in-processed goods - finished goods
Purchasing discounts
Replenishments
Inventory flow
Types of inventory
25. Those cost that vary with the amount of inventory in the short run
Major properties of inventory
Inventory holding costs
Capital costs (opportunity costs)
Storage space
26. As you move up in the supply chain...
Types of inventory
Problems become more complex
Contraints
Type of inventory system
27. Display inventory carried to increase product visibility stimulate demand
Repetiveness
Internal shortage
Inventory risk cost
Psychic stock
28. 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
Storage space costs
Inventory holding costs
In-Proccess Goods
Classifying inventory problems
29. Demands - replenishments - - constraints - and costs
Supplies inventory
Manufacturers
Hurdle rate
Properties of inventory
30. Repetiveness - source of supply - type of demand - type of lead time - type of inventory system
Classifying inventory problems
Safety stock (buffer stock)
Repetiveness
Major properties of inventory
31. Gives firms a competitive advantage due to lower costs and greater flexibility
Supplies inventory
The categorization of inventory by the purpose that it serves
Type of lead time
Less inventory
32. What purpose does inventory serve? working stock - anticipation stock (seasonal stock) - safety (buffer) stock - pipeline stock - decoupling stock - psychic stock
Functional classifications
Different departments in a firm
How are inventory problems classified
Capital costs (opportunity costs)
33. 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)
Safety stock (buffer stock)
Classification of Inventory item
Inventory service cost
Purchasing discounts
34. As items are completed - they enter another pool-finihsed goods - this pool must be controlled with regard to external demand
Second phase
Inventory
Repetiveness
Third phase
35. The cost associated with a foregone alternative use of the capital - that is - the benefits that could have been obtained from that alternative
Capital cost
Discontinuity Factor
Type of inventory system
Source of supply
36. Protection from the unexpected (forecast errors - break downs - strikes - disasters)
Uncertainty Factors
Different departments in a firm
Inventory holding costs
Retailers - wholesalers - and distributors
37. Often everybody's concern - but nones responsibility
Onventory management
Major properties of inventory
Inventory/materials manager
Functional classifications
38. Demands - replenishments - constraints - and costs
Major properties of inventory
Storage space costs
Retailers - wholesalers - and distributors
Inventory risk cost
39. Often a lot of conflict when it comes to inventory decisions - sub optimization problems (managers only looking out for their own departments)
Replenishments
Inventory management
Onventory management
Different departments in a firm
40. If the firm uses a warehouse or distributor centers - there must be additional pools of finished inventory
Uncertainty Factors
Properties of inventory
Psychic stock
Additional phases
41. Usually a firm's largest expenditure
Material costs
Safety stock (buffer stock)
Uncertainty Factors
Goals of inventory management
42. A customers order cannot be met - backorder costs - present profit loss - future profit loss
External shortage
Demands
Growing companies
Responsibility
43. 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
Types of inventory costs
The categorization of inventory by reasons for its existence
Second phase
Manufacturers
44. Items consumes in the normal functioning of a firm that are NOT part of the final product; ex: pencils - light bulbs - drill bits - paper
Types of inventory costs
Type of demand
Supplies inventory
Inventory holding costs
45. 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
Stock out costs
Supplies inventory
How are inventory problems classified
Manufacturers
46. Limitations placed on inventory systems - ex: space constraints - capital - facility - equipment - personal - management policies and administrative decisions
Pipeline stock
Classifying inventory problems
Replenishments
Contraints
47. The stock of materials on hand at a given time and the unutilized assets waiting for sale or use
Capital cost
Major properties of inventory
Inventory management
Raw Materials Inventory
48. Repetiveness - source of supply - type of demand - type of lead time - type of inventory
Different departments in a firm
Additional phases
Capital cost
How are inventory problems classified
49. Hold only finished goods inventories/supplies - they have inventory problems confined to supplies and finished goods
Inventory flow
Type of inventory system
Retailers - wholesalers - and distributors
Inventory management
50. Involves controlling the flow of materials into and out of a system - a big timing problem
Functional classifications
Inventory risk cost
Inventory management
Inventory flow