13) A certain type of computer costs $1,000, and the annual holding cost is 25%. Annual demand is 10,000 units, and the order cost is $150 per order. What is the approximate economic order quantity?

C) 110 More test answers on https://studyhippo.com/final-practice-set/

The need to place an order for inventory is specified by the A) company inventory policies. B) economic order quantity. C) stockout point. D) reorder point.

Answer: D More test answers on https://studyhippo.com/chapter-13-ais/

The traditional approach to inventory management to ensure sufficient quantity on hand to maintain production is known as A) safety stock. B) just-in-time production. C) economic order quantity. D) optimal inventory quantity.

Answer: C More test answers on https://studyhippo.com/chapter-13-ais/

Economic Order Quantity test questions and answers | Get Access To Economic Order Quantity Flashcards and exam tests

Q: If the actual order quantity is the same as the economic order quantity in a problem that meets the assumptions of the economic order quantity model shown below, the average amount of inventory on hand

C) is one-half of the economic order quantity More test answers on https://studyhippo.com/final-practice-set/

Q: 9) Economic Order Quantity (EOQ) includes several variables that must be taken into consideration when calculating the optimal order size. One variable, the costs associated with holding inventory, is referred to as 9) Economic Order Quantity (EOQ) includes several variables that must be taken into consideration when calculating the optimal order size. One variable, the costs associated with holding inventory, is referred to as

B) carrying costs. More test answers on https://studyhippo.com/acct-ch-13/

Q: The economic order quantity deals with calculating the proper order size with respect to ___ costs and ____ costs.

carrying; ordering More test answers on https://studyhippo.com/logistics-final/

Q: The Economic Order Quantity

Assumes that delivery times of each order are consistent. More test answers on https://studyhippo.com/managerial-finance-test-3/

Q: Economic order quantity EOQ

the order size that minimizes annual cost answers the the question how much to order More test answers on https://studyhippo.com/mgmt-339-ch-13-inventory-management/

Q: Economic Order Quantity (EOQ) includes several variables that must be taken into consideration when calculating the optimal order size. One variable, the costs associated with holding inventory, is referred to as A) ordering costs. B) carrying costs. C) the reorder point. D) stockout costs.

Answer: B More test answers on https://studyhippo.com/chapter-13-ais/

Q: Two fundamental inventory decisions are when to order and how much to order. Which of the following statement is true with respect to Fixed Quantity (FQS) and Fixed Period (FPS) inventory systems? a. A FPS orders a fixed period quantity when the inventory position reaches or drops below the reorder point (r). b. A FPS must cover a time period of T + L to cover the risk of a stock out. c. A FPS places an order for the economic order quantity every T time units. d. A FQS places an order to replenish the inventory position up to a target level (M) when the inventory position reaches the reorder point (r).

B More test answers on https://studyhippo.com/mgmt-480-chapter-12/

Home Page Social Science Economics Finance Economic Order Quantity

We've found 23 Economic Order Quantity tests

Economic Order Quantity Learning Maintain Eye Contact Multiple Choice Supporting Details Username And Password Veterinary Science

vet assistant – Flashcards 219 terms

Jacob Herring

219 terms

Preview

vet assistant – Flashcards

question

Rhonda likes to move around and enjoys hands-on projects. What is Rhonda's preferred style of learning?

answer

Kinesthetic

question

You've just enrolled and you want your username and password so you can access the Ashworth College Student Portal. Where will you look for your login information?

answer

email sent to you from ash worth college

question

If you want to make sure that you are registered for your course and that all of your fees have been paid, you can do this by checking ______.

answer

Accounts

question

If you prefer to learn by reading to yourself instead of participating in a group discussion, you are most likely a(n) _______ learner. A. auditory B. kinesthetic C. delayed D. visual

answer

question

What important document would you reference to quickly see everything you'll be learning about in your program and the order of your lessons?

answer

Syllabus

question

The overall learning goals for an educational program like the one you're taking are called _______.

answer

objectives

question

Which of the following exam strategies would you apply to a multiple-choice exam?

answer

D. Read all options before selecting an answer

question

You want to learn more about the goals and values of Ashworth College. In what important document will you find the school's mission statement and value statement?

answer

D. Student Handbook

question

How can you review your grades on the Ashworth site?

answer

D. Access the course page, then click on Gradebook

question

Nello has been asked to summarize what he learned in a reading assignment. In response, Nello should ______.

answer

C. cover the main points of the material he has read

question

If you're able to understand directions more easily when you hear them instead of reading them, you are most likely a(n) _______ learner.

answer

B. auditory

question

Juan has an essay due in English on Wednesday and a page of math homework due on Friday. How should Juan approach this work?

answer

D. Complete the English essay before moving to the math homework.

question

The Check Your Learning assignments in your lesson materials are a good example of what type of assessment?

answer

D. Self-assessment

question

The most effective way to do well on your online exams is to study _______.

answer

B. strategically

question

Mia wrote out her notes, then recited them into a recording device. Afterward, she played the notes back to herself. Which type of learner is Mia? A. Kinesthetic B. Auditory C. Visual D. Hands-on

answer

question

Individuals can earn the credential Certified Veterinary Practice Manager (CVPM) by meeting the educational and examination requirements of the A. AVMA. B. USDA. C. VHMA. D. CVTEA.

answer

question

Which one of the following statements regarding the OSHA Right to Know Law is most accurate? A. It requires that all hospital staff members be informed of all chemicals they may be exposed to while at work. B. It advises that you wear safety glasses and gloves when working with hazardous chemicals. C. It recommends keeping a list of the type and location of all harmful chemicals that are used in the workplace. D. It's an unenforceable law.

answer

question

The _______ contain(s) the principles that govern a profession. A. state's Veterinary Practice Act B. code of ethics C. model practice act D. State Department of Labor Regulations

answer

question

The basic requirement for working in a veterinary practice is a A. desire to work with the public. B. love of animals. C. drive to educate others. D. need to feel involved.

answer

question

The first formal programs for educating veterinary assistants were created in A. England. B. New York C. the United States Army. D. France.

answer

question

Which one of the following activities may be delegated to a veterinary technician? A. Diagnosis of parasite infection B. Prescribing medication C. Performing a cat castration D. Administering anesthesia

answer

question

Ethics may be defined as A. general acceptance toward others. B. the system of moral principles that determines appropriate behavior and actions within a specific group. C. the system of protocols among a specific group of professionals. D. differences among beliefs.

answer

question

Which one of the following activities may be performed only by a veterinarian? A. Administering medication B. Collecting diagnostic samples C. Administering general anesthesia D. Forming a diagnosis

answer

question

Which one of the following statements concerning controlled substances log book records is most accurate? A. By law, records must be made available to the OSHA inspector. B. Only state laws apply to controlled substances. C. All veterinary practice personnel may access the records. D. All records must be maintained for at least five years.

answer

question

The _______ accredits college programs for educating veterinarians and veterinary technicians. A. VHMA B. AVMA C. NAVTA D. NAVLE

answer

question

Most veterinarians attend _______ years of college to become eligible for a veterinary license. A. two B. four C. six D. eight

answer

question

The likely outcome of a patient's disease or condition is the A. diagnosis. B. zoonosis. C. prognosis. D. stenosis.

answer

question

Responsibilities of early veterinarians focused primarily on A. personal pets. B. farm animals. C. exotic pets. D. rare animals.

answer

question

The federal agency responsible for enforcing regulations related to controlled drugs is the A. DEA. B. USDA. C. OSHA. D. CSA.

answer

question

_______ would likely be patients at an exotic-animal practice. A. Dogs B. Cats C. Horses D. Birds

answer

question

A veterinary technician who completes additional specialized training and passes a certifying examination is correctly referred to as a A. diplomate. B. VTS. C. DVMS. D. trainee.

answer

question

A veterinarian who completes additional specialized training and passes a certifying examination is correctly referred to as a A. diplomate. B. VTS. C. DVMS. D. trainee.

answer

question

DEA refers to the A. Drug Enforcement Agency. B. Data Employment Agency. C. Drug Employment Agency. D. Direct Employment Agency.

answer

question

Euthanizing healthy animals or animals with treatable diseases is considered A. legal. B. ethical. C. moral. D. judicial.

answer

question

Which one of the following statements indicates proper telephone etiquette? A. Owners of hospitalized animals should be discouraged from calling to inquire about the condition of their animals. B. The telephone should be allowed to ring at least five times before answering so as to give the impression of a busy, thriving practice. C. The telephone should be answered before the end of the third ring. D. The phrases and tone of voice used to greet a caller are unimportant, as long as they convey competence.

answer

question

_______ scheduling involves scheduling all clients that would be seen in one hour at the top of the hour and then seeing them in the order in which they arrive. A. Walk-in B. Flow C. On-demand D. Wave

answer

question

Appointments for the evaluation of sick patients are usually allotted _______ minutes in the appointment schedule. A. 5 B. 10 C. 15 D. 30

answer

question

When putting a client on hold, which one of the following phrases is most acceptable? A. "Hold, please." B. "May I put you on hold for a moment?" C. "We're very busy. I'll have to put you on hold for a minute." D. "You'll have to wait. I've got another call."

answer

question

The difference between the cost of a product and the amount charged a client is called the A. markup. B. economic order quantity. C. copay. D. overstock percentage.

answer

question

A _______ is the amount of a bill that the owner is responsible for after the pet insurance deductible has been met. A. premium B. copay C. deductible D. lifetime limit

answer

question

The _______ released a landmark study in 1999 indicating that the increased use of veterinary pet health insurance could increase the demand for service, and, therefore, decrease the euthanasia rate in the United States. A. FDA B. USDA C. AVMA D. NCVEI

answer

question

When greeting clients in the reception area, you should direct clients to place all pet carriers A. on the reception counter. B. on the floor in front of the reception counter. C. in an exam room. D. on a chair in the waiting room.

answer

question

_______ scheduling involves scheduling each client according to the length of time that the particular type of appointment requires. A. Walk-in B. Flow C. On-demand D. Wave

answer

question

Products dispensed to clients usually have a markup of A. $3-5. B. $5-10. C. $8-14. D. $15-20.

answer

question

Accounts that can't be collected by the front office team need to be placed with a _______ agency. A. CareCredit B. collection C. catastrophic insurance D. copay

answer

question

Inventory items should ideally be used within _______ of purchase. A. one month B. three to six months C. six to nine months D. one year

answer

question

When making appointments for clients, it's best to offer A. two choices of appointment times. B. at least three choices of appointment times. C. an appointment at any time the client considers convenient. D. one specific appointment time with no alternatives.

answer

question

The _______ is often responsible for verifying that all items are placed on shelves and other inventory locations. A. receptionist B. veterinary assistant C. practice manager D. veterinarian

answer

question

Accounts receivable totals should never exceed _______ percent of the total gross revenue amount. A. 1 B. 3 C. 5 D. 10

answer

question

Clients must usually fulfill a _______ before the insurance company will offer compensation for a clinic visit. A. premium B. copay C. deductible D. lifetime limit

answer

question

Routine appointments for examinations and vaccinations are usually allotted _______ minutes in the appointment schedule. A. 5 B. 10 C. 15 D. 30

answer

question

Total inventory costs shouldn't exceed about _______ percent of the overall practice income. A. 3 B. 5 C. 15 D. 30

answer

question

According to the Fair Debt Rules, clients may not be called before _______ A.M. or after 9 P.M. A. 6 B. 7 C. 8 D. 9

answer

question

_______ is the number of times per year that a particular inventory item is ordered. A. Reorder point B. Stock level C. Inventory turns per year D. Economic order quantity

answer

question

Inactive medical records must be retained for _______ years. A. 2 B. 3 C. 7 D. 10

answer

question

When a client arrives to pick up his or her pet being discharged from the hospital, the _______ should handle the billing prior to the owner receiving the animal. A. receptionist B. veterinarian C. practice manager D. accountant

answer

question

Any history of allergies or hip dysplasia in the patient or other genetic diseases in the patient's parents or siblings are recorded in the _______ section of the SOAP. A. S B. O C. A D. P

answer

question

A euthanasia form always authorizes A. the necropsy of a deceased pet. B. the disposal of a deceased pet. C. the death of a pet in a humane manner. D. heroic measures to save the pet.

answer

question

A practice that manages most of the hospital information using computer software is considered A. paperless. B. less-paper. C. paperwise. D. paperlite.

answer

question

Communication with the owner regarding the pet's condition is recorded in the _______ section of the SOAP. A. S B. O C. A D. P

answer

question

The term that refers to the primary reason the client has made the appointment to bring the pet to the practice is A. subjective information. B. patient history information. C. presenting problem. D. POMR.

answer

question

Information about the type of food fed to a pet and any supplements administered to the pet (such as vitamins) will be recorded on the _______ form. A. patient history B. medical record C. client information D. treatment consent

answer

question

Which one of the following pieces of information about the vaccine is required on a rabies vaccination certificate? A. Route of administration B. Manufacturer of vaccine C. Volume of vaccine administered D. Date of last vaccine

answer

question

Appointments for recheck visits should be made A. by calling the client the day after the procedure. B. by calling the client one week after the procedure. C. before the client leaves the clinic. D. before the initial procedure is performed.

answer

question

For scheduled admissions, the patient record is retrieved A. one hour prior to the admission. B. one day prior to the admission. C. one week prior to the admission. D. when the client arrives at admission.

answer

question

A(n) _______ form is signed by the client after all information regarding the procedure has been provided and the client has had the opportunity to ask questions. A. blanket consent B. treatment information C. client information D. informed consent

answer

question

Results of diagnostic tests are recorded in the _______ section of the SOAP. A. S B. O C. A D. P

answer

question

Information on where a pet was acquired is usually included on the _______ form. A. patient information B. treatment consent C. behavioral history D. client information

answer

question

Observations made by the client are recorded in the _______ section of the SOAP. A. S B. O C. A D. P

answer

question

Treatments, surgery, and medications are recorded in the _______ section of the SOAP. A. S B. O C. A D. P

answer

question

The United States government agency that provides a form needed for transport of animals across state lines is the A. Humane Society of the United States. B. Food and Drug Administration. C. National Institutes of Health. D. United States Department of Agriculture.

answer

question

POMR is an acronym that stands for A. Patient-Owner Medical Record. B. Patient-Objective Medical Record. C. Problem-Oriented Medical Record. D. Plan-Objective Medical Record.

answer

question

Client and patient records can be shared with _______ without the owner's permission. A. boarding kennels B. social media sites C. other employees of the practice D. doctors at other hospitals

answer

question

The definitive diagnosis is recorded in the _______ section of the SOAP. A. S B. O C. A D. P

answer

question

Once solutions to conflict are identified, it's important to create a(n) _______ to implement solutions. A. meeting schedule B. action list C. problem list D. new work schedule

answer

question

Body language accounts for almost _______ percent of communication. A. 60 B. 40 C. 20 D. 10

answer

question

Before you begin to reply to someone, wait _______ until after he or she is finished and use that time to formulate your response. A. three seconds B. one second C. three minutes D. one minute

answer

question

Words or phrases that have a high potential to elicit a negative response from others are referred to as A. environmental barriers. B. conflict resolving. C. language barriers. D. resolution implementation.

answer

question

_______ percent of the households in the United States that own at least one pet indicate that their bond with their pet is "very strong." A. Ten B. Thirty C. Fifty D. Eighty

answer

question

_______ is also known as secondary traumatic stress disorder. A. Stress B. Job burnout C. Compassion fatigue D. Trauma

answer

question

_______ can be used for medical-record keeping to reduce the need to record repetitious entries on multiple records. A. Hospital manuals B. Computerized systems C. Digital backups D. Standard operating procedures

answer

question

Managing compassion fatigue starts with _______ the condition. A. denial of B. therapy for C. treatment of D. awareness of

answer

question

When educating clients about their pet's health, you should always use A. strict medical terminology. B. models and handouts. C. a strong, commanding tone of voice. D. actual illustrations from the medical records of other clients.

answer

question

_______ and resolution are healing emotions when the client accepts the loss and may begin to consider obtaining another pet. A. Bargaining B. Anger C. Sorrow D. Guilt

answer

question

To demonstrate that you're interested in what another person is saying, you should A. maintain eye contact. B. stare at the person. C. cross your arms. D. fold your hands.

answer

question

In body language, folded arms generally indicate A. anger. B. defensiveness. C. discomfort. D. a sense of superiority.

answer

question

The first stage of grief is usually A. anger. B. bargaining. C. guilt. D. denial.

answer

question

In body language, _______ is generally regarded as aggressive. A. nodding B. tilting the head C. crossing the hands D. staring

answer

question

Owners of _______ will likely feel pet loss intensely. A. family pets B. hunting dogs C. assistance dogs D. herding dogs

answer

question

When dealing with an angry client, you should ask him or her to A. wait in a quiet room to cool off. B. join you in a separate area so you can listen to his or her concerns privately. C. wait until one of the veterinarians is available. D. leave the office with the promise that someone call him or her later.

answer

question

Owners who are well bonded to their pets are more likely to A. request euthanasia so their pet doesn't suffer. B. become angry with the practice staff. C. get a new pet as soon as one dies. D. recognize signs of illness in their pets.

answer

question

Methods to help strengthen the human-animal bond usually include A. choosing an active pet. B. recommending puppy or kitten socialization class and obedience training. C. getting a new pet as soon as one dies. D. choosing a sedentary pet.

answer

question

_______ is a common root of conflict. A. Anger B. Perception C. Misunderstanding D. Laziness

answer

question

The effectiveness of any client education handout is enhanced when the veterinary team member A. packs it with the patient's take-home medications. B. uses it during the verbal discussion. C. emails it to the client. D. hands it to the client.

answer

question

Polyuria means A. decreased urine production. B. blood in the urine. C. pain in the urethra. D. much urine.

answer

question

Which joint of the hindlimb would be equivalent to the human ankle? A. Withers B. Flank C. Palmar surface D. Hock

answer

question

An intact male horse over four years old is referred to as a A. mare. B. sire. C. stallion. D. colt.

answer

question

An abnormal accumulation of blood in the pleural cavity is called A. hemothorax. B. hemopleuritis. C. hemoptysis. D. hemopneumonia.

answer

question

A young female cow before her first calf is referred to as a A. mare. B. dam. C. yearling. D. heifer.

answer

question

Which term describes a female cat? A. Tom B. Queen C. Ewe D. Bitch

answer

question

The lateral side of the abdomen between the last rib and the hindlimb is referred to as the A. withers. B. flank. C. palmar surface. D. hock.

answer

question

The term that describes a direction towards the tail end of an animal is A. muzzle. B. cranial. C. rostral. D. caudal.

answer

question

Dysuria means A. deficient urine production. B. painful or difficult urination. C. blood in the urine. D. pertaining to urination.

answer

question

Anuric means A. pertaining to absence of urine. B. much production of urine. C. deficiency of urine. D. a condition of the urine.

answer

question

The term that describes a direction towards the tip of the nose on the head is A. muzzle. B. cranial. C. rostral. D. caudal.

answer

question

Polydipsia means A. decreased drinking. B. difficult drinking. C. no drinking. D. much drinking.

answer

question

The paw is _______ to the shoulder. A. cranial B. caudal C. distal D. proximal

answer

question

The correct term to describe fever is A. polytemp. B. polyfever. C. pyoxia. D. pyrexia.

answer

question

Cystocentesis means A. movement of the thorax. B. sensation of the bladder. C. abnormal condition of the abdomen. D. surgical puncture of the bladder.

answer

question

The correct spelling of the word meaning "bluish tinge to the skin and mucous membranes" is A. cianosis. B. cyianosis. C. cyanosis. D. cyanoses.

answer

question

Enzymes contain the suffix A. -ase. B. -ate. C. -ac. D. an.

answer

question

Myositis means A. inflammation of the muscles. B. inflammation of the spinal cord. C. a condition of the muscles. D. a condition of the spinal cord.

answer

question

Polyuria A. is an abbreviated way of saying "renal failure." B. is the opposite of anuria. C. means "having more than one kidney." D. means "having multiple pouches developing from the urinary bladder."

answer

question

Which suffix refers to surgical removal of a body part? A. -trophy B. -lytic C. -centesis D. -ectomy

answer

question

The _______ allows for vision when drawn over the eye with the eyelids open. A. conjunctival membrane B. retina C. cornea D. nictitating membrane

answer

question

The bones of the hindlimb include the A. humerus. B. femur. C. carpus. D. radius.

answer

question

The _______ is a membrane-bound area within the cell that contains and protects the cell's DNA. A. Golgi apparatus B. mitochondria C. nucleus D. vacuole

answer

question

The lungs receive blood from the A. right ventricle. B. alveoli. C. left ventricle. D. aorta.

answer

question

Blood is a type of _______ tissue. A. epithelial B. squamous C. cartilage D. connective

answer

question

_______ is a type of tissue that covers surfaces in the body, such as organs and body cavities. A. Connective B. Muscle C. Epithelial D. Nervous

answer

question

Ligaments are an example of _______ tissue. A. connective B. muscle C. epithelial D. nervous

answer

question

During the digestive process, the majority of nutrient absorption occurs in the A. stomach. B. duodenum. C. jejunum. D. cecum.

answer

question

The _______ forms the ventral portion of the thorax. A. sternum B. atlas C. axis D. ribcage

answer

question

Nearly all mammals have _______ cervical vertebrae. A. five B. seven C. three D. eleven

answer

question

The bones of the forelimb include the A. scapula. B. femur. C. tarsus. D. tibia.

answer

question

The _______ vertebrae form the animal's tail. A. sacral B. lumbar C. cervical D. coccygeal

answer

question

Fertilization of the ovum takes place in the A. oviduct. B. vagina. C. uterus. D. ovary

answer

question

The _______ is an accessory organ to the digestive system. A. esophagus B. ureters C. malleus D. pancreas

answer

question

_______ is a general sense. A. Hearing B. Taste C. Vision D. Proprioception

answer

question

The gestation period for dogs and cats is approximately A. six weeks. B. one month. C. two months. D. five months.

answer

question

_______ muscle is involuntary muscle that surrounds many organs in the body. A. Smooth B. Cardiac C. Skeletal D. Visceral

answer

question

The _______ releases hormones that regulate hormone release from the other major endocrine glands. A. pancreas B. posterior pituitary C. hypothalamus D. adrenal gland

answer

question

The liver secretes _______ to aid in digestion. A. chyme B. bile C. digestive enzymes D. saliva

answer

question

When detecting sound, vibrations from the _______ are transferred to the ossicles. A. pinna B. cochlea C. tympanic membrane D. malleus

answer

question

A drug given intravenously as a single volume all at one time is described as a A. CRI. B. bolus. C. dosage. D. regimen.

answer

question

Drugs that don't require a prescription are referred to as A. controlled. B. over-the-counter. C. dispensable. D. generic.

answer

question

Chemical agents that kill or prevent the growth of microorganisms on living tissue are described as A. disinfectants. B. sanitizers. C. antiseptics. D. sterilizers.

answer

question

Amoxicillin is an example of a _______ name of a drug. A. proprietary B. generic C. trade D. chemical

answer

question

Of these four needle-gauge numbers, which one represents the smallest-diameter needle? A. 18 B. 20 C. 22 D. 24

answer

question

The _______ is/are the primary organ(s) involved in drug biotransformation. A. heart B. lungs C. liver D. kidney

answer

question

A(n) _______ is a semisolid drug that remains semisolid when at body temperature. A. ointment B. cream C. paste D. implant

answer

question

_______ is an inhalant anesthetic agent commonly used in veterinary medicine. A. Propofol B. Ketamine C. Sevoflurane D. Thiamylal

answer

question

A(n) _______ is a drug that's capable of inhibiting bacterial replication. A. bacteriostatic B. bactericidal C. virucidal D. anthelmintic

answer

question

A medication that's injected into the skin is abbreviated as A. IM. B. IV. C. ID. D. IP.

answer

question

An antitussive is a type of drug that A. dilates the respiratory tract. B. thins mucous secretions. C. blocks the cough reflex. D. reduces congestion.

answer

question

A medication that's injected into a blood vessel is abbreviated as A. IM. B. IV. C. ID. D. IP.

answer

question

If a medication label states that the drug must be stored at 25 degrees C, it should be placed in A. a cabinet at room temperature. B. the refrigerator. C. the freezer. D. an incubator.

answer

question

Carprofen (Rimadyl) is a type of _______ medication. A. anti-inflammatory B. NSAID C. fever-reducing D. anesthetic

answer

question

Which one of the following drugs is a commonly used analgesic in veterinary medicine? A. Yohimbine B. Fentanyl C. Phenobarbital D. Doxapram

answer

question

Veterinarians must have a certification number from the _______ in order to prescribe controlled drugs. A. USDA B. state board C. local pharmacy D. DEA

answer

question

The abbreviation po on a prescription indicates that the medication is to be administered A. by mouth. B. topically. C. in the eyes. D. by injection.

answer

question

If the veterinarian writes a prescription for a patient indicating that the patient must be given two tablets of a medication b.i.d. for seven days, how many tablets must be dispensed? A. 2 B. 7 C. 14 D. 28

answer

question

Prednisone is a type of _______ medication. A. anti-inflammatory B. NSAID C. fever-reducing D. anesthetic

answer

question

The abbreviation prn on a prescription indicates that the medication is to be administered A. orally. B. daily. C. in the right eye. D. as needed.

answer

question

Rewarding an animal with praise is effective when the praise is given within _______ of the correct behavior. A. one-half second B. 30 seconds C. 1 minute D. 10 minutes

answer

question

To restrain a dog for the collection of blood from the jugular vein, a _______ recumbency would be used. A. sternal B. ventral-dorsal C. transverse D. lateral

answer

question

_______ is the least appropriate for restraining an aggressive dog. A. Applying a gauze muzzle B. Crowding a dog into a corner of the room C. Standing restraint D. Sedating and holding a dog in lateral recumbency

answer

question

Ethology refers to A. the ethical behaviors of trainers. B. behavioral acts done with no obvious reason. C. the treatment of behavior problems. D. the study of animal behavior.

answer

question

Moving an aggressive dog from a run or a cage can best be accomplished using A. gauntlets. B. a muzzle. C. an Elizabethan collar. D. a catchpole.

answer

question

The association of a particular activity with a punishment or reward is referred to as A. operant conditioning. B. classical conditioning. C. instinct. D. imprinting.

answer

question

Stalking and pouncing behavior with no evidence of growling indicates A. separation anxiety. B. predatory aggression. C. interdog aggression. D. house soiling.

answer

question

Subduing and transporting an aggressive animal can be best accomplished with the use of A. a lasso. B. an easy nabber. C. gauntlets. D. an inhalation chamber.

answer

question

Which one of the following methods is most appropriate for lifting a 60-pound dog that's pregnant? A. Put one arm around the neck and one under the abdomen B. Put one arm around the chest and the other around the back legs C. Put the front legs on a table and boost up the back end D. Have one person control the neck and chest and another person control the other control the abdomen and rear

answer

question

The most important socialization period in kittens is A. 2 to 7 weeks. B. 4 to 16 weeks. C. 3 to 6 months. D. 6 to 12 months.

answer

question

A dog that has its head dropped lower than its shoulders, its eyes staring straight ahead, and its tail straight out, should be considered A. normal and well adjusted. B. nervous. C. frightened. D. aggressive.

answer

question

How many litter boxes should there be per household? A. One B. One for each cat C. One in each room D. One for each cat plus an extra one

answer

question

When assisting clients in choosing a new pet, be sure to A. use a puppy temperament test. B. match the client and pet activity level and lifestyle. C. recommend an older pet for older clients. D. verify that the pet can be obtained during the imprinting period.

answer

question

The most reliable way to discourage destructive clawing of furniture by cats is to A. rake their paws on a scratching post. B. punish them whenever they scratch at the furniture. C. provide an acceptable substitute. D. spray a pheromone on the furniture.

answer

question

Withholding affection when a dog jumps up to greet you is an example of A. positive reinforcement. B. negative reinforcement. C. positive punishment. D. negative punishment.

answer

question

The _______ should only be used as a last resort to restrain a cat. A. cat lasso B. restraint bag C. burrito wrap D. easy nabber

answer

question

Behaviors that bonds animals to their caretakers in early life are referred to as A. classical conditioning. B. operant conditioning. C. imprinting. D. instinct.

answer

question

Maternal aggression is primarily A. directed at humans that aren't members of the household. B. a normal protective instinct. C. the result of an unpredictable environment. D. the result of lack of socialization

answer

question

Territorial aggressive behavior in cats is usually directed toward A. people. B. dogs. C. other cats. D. furniture.

answer

question

Positioning aids such as foam wedges or v-troughs may be needed to keep a large dog comfortable in _______ recumbency. A. dorsal B. sternal C. ventral D. supine

answer

question

Transmission of disease that results from contact with an infectious agent on an inanimate object is referred to as A. direct transmission. B. indirect transmission. C. nosocomial infection. D. reservoir infection.

answer

question

_______ is a fat-soluble vitamin. A. Thiamin B. Vitamin D C. Niacin D. Folic acid

answer

question

The palatability of food is enhanced by A. warming canned food to body temperature. B. sprinkling garlic on the food. C. adding milk to dry food. D. adding raw fish or poultry to the food.

answer

question

An allergic reaction to an inhaled allergen is referred to as A. atopy. B. Cushing's disease. C. lipoma. D. pancreatitis.

answer

question

_______ refers to a component that can't be synthesized by an animal and must be provided in the diet. A. Essential amino acids B. Nonessential amino acids C. Linolenic D. Tryptophan

answer

question

A dog whose ribs are easily visible and has no palpable fat would be classified with a body condition score of A. 2. B. 4. C. 6. D. 8.

answer

question

_______ is/are an energy-producing nutrient. A. Fat B. Water C. Vitamins D. Minerals

answer

question

Vaccination against the _______ pathogen is considered non-core. A. canine distemper B. canine parvovirus C. rabies D. Borrelia burgdorferi

answer

question

The organization that publishes guidelines for pet food ingredients is A. AVMA. B. NAVTA. C. AAFCO. D. SVBT.

answer

question

Mammals can't digest A. fatty acids. B. insoluble carbohydrates. C. soluble carbohydrates. D. nonessential amino acids.

answer

question

Infestation with Dirofilaria immitis causes A. heartworm disease. B. ringworm. C. kennel cough. D. sarcoptic mange.

answer

question

Increased _______ is a sign of inflammation. A. redness B. sweating C. heart rate D. joint function

answer

question

Puppies should gain approximately _______ g/kg of their adult body weight each day. A. 1 to 2 B. 2 to 4 C. 5 to 6 D. 6 to 10

answer

question

Substances that can increase body temperature are referred to as A. toxins. B. pyrexins. C. reservoirs. D. pyrogens.

answer

question

Dogs with brachycephalic heads are prone to A. heat stress. B. diabetes. C. obesity. D. atopy.

answer

question

Zoonotic diseases are those that are A. spread between animals and people. B. contagious to other animals. C. noninfectious. D. acquired while in the veterinary hospital.

answer

question

The three major components of a preventive medicine program include A. housing, lighting, ventilation. B. husbandry, vaccination, sanitation. C. vaccination, sanitation, ventilation. D. husbandry, housing, sanitation.

answer

question

The destruction of pathogenic microorganisms on inanimate objects requires the use of A. sanitizers. B. disinfectants. C. antiseptics. D. steam.

answer

question

The cause of a disease is referred to as its A. etiology. B. necropsy. C. pathology. D. histopathology.

answer

question

_______ should be limited in a geriatric dog. A. Zinc B. Phosphorus C. Copper D. Vitamin B complex

answer

question

When expressing anal sacs, the first step is to A. gently massage the sac. B. clean the patient's perineum. C. put on a disposable glove. D. palpate the anal sac.

answer

question

_______ administration means "giving medication by injection." A. Topical B. Parenteral C. Semitendinosus D. Lavage

answer

question

Wounds that are expected to produce fluids and tissue exudates for several days are usually managed with A. adherent dressings. B. insertion of a mechanical drain device. C. lavage with a Waterpik. D. placement of dry-to-dry bandages.

answer

question

Small amounts of medications and fluids administered by SC injection are absorbed in approximately _______ minutes. A. 5 to 10 B. 20 to 30 C. 60 to 90 D. 120 to 180

answer

question

Decubital ulcers are primarily caused by A. urine scalding. B. excessive moisture. C. pressure. D. delayed wound closure.

answer

question

An open fracture is a _______ wound type. A. clean B. clean-contaminated C. contaminated D. dirty

answer

question

The recommended needle size when administering SC fluids to average-sized dogs and cats is A. 14. B. 16. C. 18. D. 22.

answer

question

For intravenous injection into the saphenous vein, the patient should be restrained in A. sternal recumbency. B. a sitting position. C. lateral recumbency. D. dorsal recumbency.

answer

question

The best way to lavage a wound is by using A. gravity flow. B. a bulb syringe. C. a 35 mL to 60 mL syringe and needle. D. a turkey baster.

answer

question

An animal would be placed in _______ for nasal administration of medications. A. sternal recumbency B. lateral recumbency C. a standing position D. dorsal recumbency

answer

question

Recumbent patients should be turned every _______ minutes. A. 15 to 30 B. 30 to 40 C. 60 to 90 D. 120 to 240

answer

question

The first step in wound management is A. control of hemorrhage. B. clipping. C. cleaning. D. debridement.

answer

question

If the quick is accidentally cut during nail trimming, the proper course of action is the A. application of pressure. B. application of ice. C. administration of pain medication. D. No action is needed.

answer

question

Which one of the following choices is an open-ended question? A. "Have you noticed Fluffy drinking more water than usual?" B. "Was this problem only observed in the last few days?" C. "How would you describe Fluffy's activity level?" D. "Does Fluffy have a fever?"

answer

question

A patient's vital signs include the patient's _______, respiratory rate, and heart or pulse rate. A. temperature B. blood type C. age D. vaccination status

answer

question

Pressure sores are also referred to as A. decubital ulcers. B. eschars. C. phlebitis. D. tenesmus.

answer

question

Skin testing is performing using _______ injection. A. SC B. IM C. ID D. IV

answer

question

A wound that's closed using sutures is said to heal by A. granulation. B. first-intention healing. C. delayed healing. D. second-intention healing.

answer

question

Signs of ear disease include A. vomiting. B. sneezing. C. abnormal odor. D. dilated pupils.

answer

question

_______ wounds are wounds that have happened very recently. A. Open B. Acute C. Chronic D. Closed

answer

question

SOAP?

answer

Subjective, objective, assesment, plan

question

What does the Subjective mean in soap?

answer

Onset Location Duration CHaracter (sharp, dull, etc.) Alleviating/Aggravating factors Radiation Temporal pattern (every morning, all day, etc.) Severity Variants on this mnemonic (more than one could be listed here) include OPQRST and LOCQSMAT Location Onset (when and mechanism of injury - if applicable) Chronology (better or worse since onset, episodic, variable, constant, etc.) Quality (sharp, dull, etc.) Severity (usually a pain rating) Modifying factors (what aggravates/reduces the symptoms - activities, postures, drugs, etc.) Additional symptoms (un/related or significant symptoms to the chief complaint) Treatment (has the patient seen another provider for this symptom?)

question

what does the Objective mean in soap?

answer

Vital signs and measurements, such as weight. Findings from physical examinations, including basic systems of cardiac and respiratory, the affected systems, possible involvement of other systems, pertinent normal findings and abnormalities. Results from laboratory and other diagnostic tests already completed. Medication list obtained from pharmacy or medical records.

question

what does assessment mean in soap?

answer

A medical diagnosis for the purpose of the medical visit on the given date of the note written is a quick summary of the patient with main symptoms/diagnosis including a differential diagnosis, a list of other possible diagnoses usually in order of most likely to least likely.

question

what does plan mean in soap?

answer

The plan is what the health care provider will do to treat the patient's concerns - such as ordering further labs, radiological work up, referrals given, procedures performed, medications given and education provided. The plan will also include goals of therapy and patient-specific drug and disease-state monitoring parameters.

STUDY

Asia And Latin America Business Management Critical Success Factors Economic Order Quantity Management Operations Management World Trade Organization

Operations True/False 2 – Flashcards 30 terms

Darryl Wooten

30 terms

Preview

Operations True/False 2 – Flashcards

question

1. The Boeing 787 Dreamliner has content from over a dozen countries in addition to the U.S.

answer

True

question

2. Boeing used international partners in building the Boeing 787 Dreamliner partly to attract demand from its competitor.

answer

True

question

3. Production processes are being dispersed to take advantage of national differences in labor costs.

answer

True

question

4. NAFTA seeks to phase out all trade and tariff barriers between the United States and Asia.

answer

False

question

5. One reason for global operations is to gain improvements in the supply chain.

answer

True

question

6. One reason to globalize is to learn to improve operations.

answer

True

question

7. To attract and retain global talent, and to expand a product's life cycle, are both reasons to globalize.

answer

True

question

8. A product will always be in the same stage of its product life cycle regardless of the country.

answer

False

question

9. The World Trade Organization helps provide governments and industries around the world with protection from firms that engage in unethical conduct.

answer

True

question

10. The World Trade Organization has eliminated unequal protection of intellectual property among nations.

answer

False

question

11. An organization's strategy is its purpose or rationale for an organization's existence.

answer

False

question

12. Operations strategies are implemented in the same way in all types of organizations.

answer

False

question

13. An organization's behavior will be optimized if each of its departments optimizes their behaviors independently.

answer

False

question

14. Experience differentiation is an extension of product differentiation, accomplished by using people's five senses to create an experience rather than simply providing a service.

answer

True

question

15. An organization's ability to generate unique advantages over competitors is central to a successful strategy implementation.

answer

True

question

16. Low-cost leadership is the ability to distinguish the offerings of the organization in any way that the customer perceives as adding value.

answer

False

question

17. Most services are tangible; this factor determines how the ten decisions of operations management are handled differently for goods than for services.

answer

False

question

18. The relative importance of each of the ten operations decisions depends on the ratio of goods and services in an organization.

answer

True

question

19. Decisions that involve what is to be made and what is to be purchased fall under the heading of supply-chain management.

answer

True

question

20. Manufacturing organizations have ten strategic OM decisions, while service organizations have only eight.

answer

False

question

21. Errors made within the location decision area may overwhelm efficiencies in other areas.

answer

True

question

22. The PIMS study indicated that high ROI firms tend to have high product quality.

answer

True

question

23. Among the categories of strategic options, marketing and distribution offer an easier route to sustainable competitive advantage than operations management.

answer

False

question

24. Strategies change because an organization's internal strengths and weaknesses may change.

answer

True

question

25. SWOT analysis identifies those activities that make a difference between having and not having a competitive advantage.

answer

False

question

26. For the greatest chance of success, an organization's operations management strategy must support the company's strategy.

answer

True

question

27. Critical Success Factors are those relatively few activities that make a difference between having and not having a competitive advantage.

answer

True

question

28. A multinational corporation has extensive international business involvements.

answer

True

question

29. The multidomestic OM strategy maximizes local responsiveness while achieving a significant cost advantage.

answer

False

question

30. Firms using the global strategy can be thought of as "world companies."

answer

False

STUDY

Business And Management Business Management Demand Economic Order Quantity Marketing And Sales Principles Of Marketing Supply And Demand

GSCM Ch.9, 10, 11, 12 – Flashcards 278 terms

James Hopper

278 terms

Preview

GSCM Ch.9, 10, 11, 12 – Flashcards

question

Predictable variability is change in demand that cannot be forecasted.

answer

False

question

Faced with predictable variability of demand, a company's goal is to respond in a manner that maximizes profitability.

answer

True

question

The advantage of carrying enough manufacturing capacity to meet demand in any period is very low inventory costs, because no inventory needs to be carried from period to period.

answer

True

question

The disadvantage of carrying enough manufacturing capacity to meet demand in any period is that much of the expensive capacity would go unused during most months when demand was lower.

answer

True

question

The advantage of building up inventory during the off season to keep production stable year round lies in the fact that a firm could get by with a smaller, more expensive factory.

answer

False

question

The disadvantage of building up inventory during the off season to keep production stable year round is the expensive capacity that would go unused during most months when demand was lower.

answer

False

question

An approach where a firm works with their retail partners in the supply chain to offer a price promotion during periods of low demand would shift some of the demand into a slow period, thereby spreading demand more evenly throughout the year and reducing the seasonal surge.

answer

True

question

With supply and demand management decisions being made independently, it is easier to coordinate the supply chain, thereby increasing profit.

answer

False

question

A firm can vary supply of product by controlling production capacity inventory.

answer

True

question

A firm that uses flexible work hours from the workforce to manage capacity to better meet demand is using a seasonal workforce

answer

False

question

Scheduling the workforce so that the available capacity better matches demand is using time flexibility from the workforce.

answer

True

question

The use of a part-time workforce to increase the capacity flexibility by enabling the firm to have more people at work during peak periods is designing product flexibility into the production processes.

answer

False

question

A firm that uses a temporary workforce during the peak season to increase capacity to match demand is using a seasonal workforce.

answer

True

question

The use of dual facilities to manage capacity may be hard to sustain if the labor market is tight.

answer

False

question

A firm that purchases peak production capability from other companies so that internal production remains level and can be done cheaply is using subcontracting.

answer

True

question

A firm that builds dedicated facilities to produce a relatively stable output of products over time in a very efficient manner and purchases peak production capability from other companies is using subcontracting.

answer

False

question

A firm that has production lines whose production rate can easily be varied to match demand has designed product flexibility into the production processes.

answer

True

question

The use of a seasonal workforce requires that the workforce be multi-skilled and easily adapt to being moved from line to line.

answer

True

question

The use of common components across multiple products, with each product having predictably variable demand, will result in the demand for the components being relatively constant.

answer

True

question

When most of the products a firm produces have the same peak demand season, the use of common components to create relatively constant overall demand in the components is feasible.

answer

False

question

When most of the products a firm produces have the same peak demand season, it is necessary to build products during the off season that have more predictable demand.

answer

True

question

Operations usually make the promotion and pricing decisions.

answer

False

question

Maximizing revenue is typically the objective when marketing and sales make the promotion and pricing decisions.

answer

True

question

Pricing decisions based only on revenue considerations often result in an increase in overall profitability.

answer

False

question

The combination of pricing and aggregate planning (both demand and supply management) can be used to maximize supply chain profitability.

answer

True

question

When performing aggregate planning, the goal of all firms in the supply chain should be to maximize individual firm profits.

answer

False

question

Determining how profits will be allocated to different members of the supply chain is a key to successful collaboration.

answer

True

question

In general, as the fraction of increased demand coming from forward buying grows, offering the promotion during the peak demand period becomes more attractive.

answer

False

question

Offering a promotion during a peak period that has significant forward buying creates even more variable demand than before the promotion.

answer

True

question

Average inventory decreases if a promotion is run during the peak period and increases if the promotion is run during the off-peak period.

answer

False

question

Promoting during a peak demand month may decrease overall profitability if a significant fraction of the demand increase results from a forward buy.

answer

True

question

As forward buying becomes a smaller fraction of the demand increase from a promotion, it is less profitable to promote during the peak period.

answer

False

question

As the product margin declines, promoting during the peak demand period becomes less profitable.

answer

True

question

When faced with seasonal demand, a firm should use a combination of pricing (to manage demand) and production and inventory (to manage supply) to improve profitability.

answer

True

question

Predictable variability is a. change in demand that can be forecasted. b. change in demand that cannot be forecasted. c. change in demand that has been planned. d. change in demand that has been scheduled. e. all of the above

answer

a. change in demand that can be forecasted.

question

Which of the following is not a problem caused by products experiencing predictable variability of demand? a. high levels of stockouts during peak demand b. high levels of excess inventory during periods of low demand c. increased responsiveness of the supply chain d. increased costs in the supply chain e. decreased responsiveness of the supply chain

answer

c. increased responsiveness of the supply chain

question

A firm can handle predictable variability by managing a. supply using capacity, inventory, trade promotions, and backlogs. b. supply using capacity, inventory, subcontracting, and backlogs. c. demand using short-term price discounts and trade promotions. d. a and c only e. b and c only

answer

e. b and c only

question

Seasonal demand can be met by a. maintaining enough manufacturing capacity to meet demand in any period. b. building up inventory during the off season to meet demand during peak seasons. c. offering a price promotion during periods of low demand to shift some of the demand into a slow period. d. all of the above e. a and b only

answer

d. all of the above

question

The advantage of maintaining enough manufacturing capacity to meet demand in any period is a. very low inventory costs because inventory needs to be carried from period to period. b. very low inventory costs because no inventory needs to be carried from period to period. c. very high inventory costs because no inventory needs to be carried from period to period. d. very high inventory costs because expensive capacity would go unused during most months when demand was lower. e. none of the above

answer

b. very low inventory costs because no inventory needs to be carried from period to period.

question

The disadvantage of maintaining enough manufacturing capacity to meet demand in any period is a. much of the expensive capacity would go unused during most months when demand was lower. b. the expensive capacity would be used consistently throughout the year. c. most of the expensive capacity would still be used during most months when demand was lower. d. very low inventory costs because no inventory needs to be carried from period to period. e. None of the above are true.

answer

a. much of the expensive capacity would go unused during most months when demand was lower.

question

The advantage of building up inventory during the off season to meet demand during peak seasons and keep production stable year round is a. very low inventory costs because no inventory needs to be carried from period to period. b. much of the expensive capacity would go unused during most months when demand was lower. c. in the fact that a firm could get by with a smaller, less expensive factory. d. in the fact that a firm could get by with a larger, more expensive factory. e. None of the above are true.

answer

c. in the fact that a firm could get by with a smaller, less expensive factory.

question

The disadvantage of building up inventory during the off season to meet demand during peak seasons and keep production stable year round is a. very low inventory costs because no inventory needs to be carried from period to period. b. very high inventory costs because inventory needs to be carried from period to period. c. in the fact that a firm could get by with a smaller, less expensive factory. d. in the fact that a firm could get by with a larger, more expensive factory. e. None of the above are true.

answer

b. very high inventory costs because inventory needs to be carried from period to period.

question

The advantage of offering a price promotion during periods of low demand to shift some of the demand into a slow period is a. a demand pattern that is less expensive to supply. b. very high inventory costs because inventory needs to be carried from period to period. c. in the fact that a firm could get by with a smaller, more expensive factory. d. much of the expensive capacity would go unused during most months when demand was lower. e. all of the above

answer

a. a demand pattern that is less expensive to supply.

question

Companies typically divide the task of supply and demand so that a. Marketing manages demand and Operations manages supply. b. Marketing manages supply and Operations manages demand. c. Marketing manages demand and supply. d. Operations manages demand and supply. e. none of the above

answer

a. Marketing manages demand and Operations manages supply.

question

As the product margin declines, promoting during the peak demand period becomes a. less profitable. b. more profitable. c. less of a risk. d. more desirable. e. none of the above

answer

a. less profitable.

question

Promoting during a peak demand month may decrease overall profitability if a. a small fraction of the demand increase results from a forward buy. b. any of the demand increase results from a forward buy. c. a significant fraction of the demand increase results from a forward buy. d. none of the above e. all of the above

answer

c. a significant fraction of the demand increase results from a forward buy.

question

Average inventory a. increases if a promotion is run during the peak period. b. increases if a promotion is run during the off-peak period. c. decreases if a promotion is run during the peak period. d. decreases if a promotion is run during the off-peak period. e. both a and d

answer

b. increases if a promotion is run during the off-peak period.

question

Offering a promotion during a peak period that has significant forward buying a. creates a desirable demand pattern. b. creates a demand pattern less costly to serve. c. creates a demand pattern even more costly to serve. d. shifts demand from the peak period to the slow period. e. shifts demand to a more desirable period.

answer

c. creates a demand pattern even more costly to serve.

question

In general, as the fraction of increased demand coming from forward buying grows, offering the promotion during the peak demand period becomes a. less attractive. b. more attractive. c. more profitable. d. less significant. e. none of the above

answer

a. less attractive.

question

Customers moving up future purchases to the present is a. market growth. b. stealing share. c. forward selling. d. forward buying. e. none of the above

answer

d. forward buying.

question

Customers substituting the firm's product for a competitor's product is a. market growth. b. stealing share. c. forward selling. d. forward buying. e. none of the above

answer

b. stealing share.

question

An increase in consumption of the product either from new or existing customers is a. market growth. b. stealing share. c. forward selling. d. forward buying. e. none of the above

answer

a. market growth.

question

Which of the following is not a factor that would result in increased demand from a trade promotion? a. market growth b. stealing share c. forward selling d. forward buying e. All of the above are factors in increased demand.

answer

c. forward selling

question

Which of the following is not a key factor influencing the timing of a trade promotion? a. impact of the promotion on demand b. product margins c. cost of holding inventory d. cost of changing capacity e. none of the above

answer

e. none of the above

question

One key to successful collaboration when the supply chain is performing aggregate planning is a. determining how losses will be allocated to different members of the supply chain. b. determining how profits will be allocated to different members of the supply chain. c. determining how labor will be allocated to different members of the supply chain. d. determining how customers will be allocated to different members of the supply chain. e. none of the above

answer

b. determining how profits will be allocated to different members of the supply chain.

question

When planning, the goal of all firms in the supply chain should be to maximize supply chain profits because a. this leaves them less profit to divide among themselves. b. this leaves them more profit to divide among themselves. c. this outcome leaves them more profit to pay tax on. d. this outcome will increase their charitable giving. e. none of the above

answer

b. this leaves them more profit to divide among themselves.

question

When performing aggregate planning, the goal of all firms should be to a. minimize company profits. b. maximize company profits. c. minimize supply chain profits. d. maximize supply chain profits. e. All of the above are accurate.

answer

d. maximize supply chain profits.

question

The combination of pricing and aggregate planning (both demand and supply management) can be used to a. maximize customer orders. b. minimize customer orders. c. maximize supply chain profitability. d. minimize supply chain profitability. e. None of the above are accurate.

answer

c. maximize supply chain profitability.

question

Pricing decisions based only on revenue considerations often result in a. a decrease in overall profitability. b. an increase in overall profitability. c. a decrease in overall revenue. d. a decrease in supply chain revenue. e. an increase in supply chain profitability.

answer

a. a decrease in overall profitability.

question

The promotion and pricing decisions made by marketing and sales typically have the objective of a. maximizing profitability. b. minimizing profitability. c. minimizing revenue. d. maximizing revenue. e. maximizing profitability across the supply chain.

answer

d. maximizing revenue.

question

The pricing and promotion decisions are often made by a. marketing and sales. b. marketing and operations. c. operations and sales. d. marketing, operations, and sales. e. marketing and operations without sales.

answer

a. marketing and sales.

question

Supply chains can influence demand by using a. production capacity and inventory. b. pricing and other promotions. c. price promotions and inventory. d. production capacity and inventory promotions. e. production capacity and other promotions.

answer

b. pricing and other promotions.

question

When most of the products a firm produces have the same peak demand season, in order to meet predictable variability with inventory, it must a. use common components across multiple products. b. use a seasonal workforce. c. build inventory of high demand or predictable demand products. d. use subcontracting. e. use dual facilities—dedicated and flexible.

answer

c. build inventory of high demand or predictable demand products.

question

Which of the following is an approach that firms can use when managing inventory to meet predictable demand variability? a. time flexibility from workforce b. use of seasonal workforce c. use of subcontracting d. use of dual facilities—dedicated and flexible e. using common components across multiple products

answer

e. using common components across multiple products

question

Which approach to capacity management would only be effective if the overall demand across all the products is relatively constant? a. time flexibility from workforce b. use of seasonal workforce c. use of subcontracting d. use of dual facilities—dedicated and flexible e. designing product flexibility into the production processes

answer

e. designing product flexibility into the production processes

question

Which approach to capacity management would use production machinery that can be changed easily from producing one product to another? a. time flexibility from workforce b. use of seasonal workforce c. use of subcontracting d. use of dual facilities—dedicated and flexible e. designing product flexibility into the production processes

answer

e. designing product flexibility into the production processes

question

Which approach to capacity management would require that the workforce be multi-skilled and easily adapt to being moved from line to line? a. time flexibility from workforce b. use of seasonal workforce c. use of subcontracting d. use of dual facilities—dedicated and flexible e. designing product flexibility into the production processes

answer

e. designing product flexibility into the production processes

question

The key to which capacity management approach would involve having both volume (fluctuating demand from a manufacturer) and variety flexibility (demand from several manufacturers) to be sustainable? a. time flexibility from workforce b. use of seasonal workforce c. use of subcontracting d. use of dual facilities—dedicated and flexible e. designing product flexibility into the production processes

answer

c. use of subcontracting

question

Which approach to capacity management would use a part-time workforce to increase capacity flexibility by enabling the firm to have more people at work during peak periods? a. time flexibility from workforce b. use of seasonal workforce c. use of subcontracting d. use of dual facilities—dedicated and flexible e. designing product flexibility into the production processes

answer

a. time flexibility from workforce

question

Which approach to capacity management would schedule the workforce so that the available capacity better matches demand? a. time flexibility from workforce b. use of seasonal workforce c. use of subcontracting d. use of dual facilities—dedicated and flexible e. designing product flexibility into the production processes

answer

a. time flexibility from workforce

question

Which approach to capacity management makes use of overtime, which is varied to match the variation in demand? a. time flexibility from workforce b. use of seasonal workforce c. use of subcontracting d. use of dual facilities—dedicated and flexible e. designing product flexibility into the production processes

answer

a. time flexibility from workforce

question

Which approach to capacity management makes use of spare plant capacity that exists in the form of hours when the plant is not operational? a. time flexibility from workforce b. use of seasonal workforce c. use of subcontracting d. use of dual facilities—dedicated and flexible e. designing product flexibility into the production processes

answer

a. time flexibility from workforce

question

Which approach to capacity management may be hard to sustain if the labor market is tight? a. time flexibility from workforce b. use of seasonal workforce c. use of subcontracting d. use of dual facilities—dedicated and flexible e. designing product flexibility into the production processes

answer

b. use of seasonal workforce

question

The capacity management approach where a firm has production lines whose production rate can easily be varied to match demand is a. time flexibility from workforce. b. the use of seasonal workforce. c. the use of subcontracting. d. the use of dual facilities—dedicated and flexible. e. designing product flexibility into the production processes.

answer

e. designing product flexibility into the production processes.

question

With supply and demand management decisions being made independently, a. it is increasingly difficult to coordinate the supply chain, thereby increasing profit. b. it is increasingly difficult to coordinate the supply chain, thereby decreasing profit. c. it is easier to coordinate the supply chain, thereby decreasing profit. d. it is easier to coordinate the supply chain, thereby increasing profit. e. none of the above

answer

b. it is increasingly difficult to coordinate the supply chain, thereby decreasing profit.

question

The capacity management approach where a firm builds facilities to produce a relatively stable output of products over time in a very efficient manner and facilities to produce a widely varying volume and variety of products, but at a higher unit cost is a. time flexibility from workforce. b. the use of seasonal workforce. c. the use of subcontracting. d. the use of dual facilities—dedicated and flexible. e. designing product flexibility into the production processes.

answer

d. the use of dual facilities—dedicated and flexible.

question

The capacity management approach where a firm purchases peak production from another firm so that internal production remains level and can be done cheaply is a. time flexibility from workforce. b. the use of seasonal workforce. c. the use of subcontracting. d. the use of dual facilities—dedicated and flexible. e. designing product flexibility into the production processes.

answer

c. the use of subcontracting.

question

The capacity management approach that uses a temporary workforce during the peak season to increase capacity to match demand is a. time flexibility from workforce. b. the use of seasonal workforce. c. the use of subcontracting. d. the use of dual facilities—dedicated and flexible. e. designing product flexibility into the production processes.

answer

b. the use of seasonal workforce.

question

The capacity management approach that uses flexible work hours from the workforce to manage capacity to better meet demand is a. time flexibility from workforce. b. use of seasonal workforce. c. use of subcontracting. d. use of dual facilities—dedicated and flexible. e. designing product flexibility into the production processes.

answer

a. time flexibility from workforce.

question

Cycle inventory exists because producing or purchasing in large lots allows a stage of the supply chain to exploit economies of scale and increase cost.

answer

False

question

Increasing the lot size or cycle inventory often decreases the cost incurred by different stages of a supply chain.

answer

True

question

Cycle inventory is primarily held to take advantage of economies of scale and reduce profit within the supply chain.

answer

False

question

Lot sizes and cycle inventory do not affect the flow time of material within the supply chain.

answer

False

question

The inventory profile is a plot depicting the level of inventory over time.

answer

True

question

A lot or batch size is the quantity that a stage of the supply chain either produces or purchases at a given time.

answer

True

question

Cycle inventory is the physical inventory in the supply chain due to either production or purchases demanded by the customer.

answer

True

question

Cycle inventory exists in a supply chain because different stages exploit economies of scale to lower total cost

answer

True

question

Aggregating across products, retailers, or suppliers in a single order allows for a reduction in lot size for individual products because fixed ordering and transportation costs are now spread across multiple products, retailers, or suppliers

answer

True

question

A firm is often better served by ordering a convenient lot size close to the economic order quantity rather than the precise EOQ

answer

True

question

Total ordering and holding costs are unstable around the economic order quantity

answer

False

question

The costs considered in lot sizing decisions include material cost, fixed ordering cost, and manufacturing cost

answer

False

question

A key to reducing cycle inventory is the reduction of lot size

answer

True

question

Trade promotions lead to a significant increase in lot size and cycle inventory because of forward buying by the retailer

answer

True

question

Although a forward buy is often the retailer's appropriate response and increases their own profits, it usually increases demand variability with a resulting increase in inventory and flow times within the supply chain

answer

True

question

The goal of trade promotions is to influence retailers to act in a way that helps the retailer achieve its objectives

answer

False

question

Price discrimination is the practice where a firm charges differential prices to maximize profits

answer

True

question

Discounts related to price discrimination will be lot size based

answer

False

question

For products where the firm has market power, two-part tariffs can be used to achieve coordination in the supply chain and maximize supply chain profits

answer

True

question

The supply chain profit is higher if each stage of the supply chain independently makes its pricing decisions with the objective of maximizing its own profit

answer

False

question

For commodity products where price is set by the market, manufacturers can use lot size based quantity discounts to achieve coordination in the supply chain and decrease supply chain cost

answer

True

question

A key to reducing lot size without increasing costs is to reduce the holding cost associated with each lot.

answer

False

question

Quantity discounts lead to a minor buildup of cycle inventory in the supply chain

answer

False

question

Marginal unit quantity discounts have also been referred to as multi-block tariffs

answer

True

question

Pricing schedules with all unit quantity discounts encourage retailers to increase the size of their lots, which reduces the average inventory and flow time in a supply chain

answer

False

question

A discount is volume-based if the discount is based on the total quantity purchased over a given period, regardless of the number of lots purchased over that period

answer

True

question

A discount is volume-based if the pricing schedule offers discounts based on the quantity ordered in a single lot

answer

False

question

Reduction of fixed cost may be achieved by aggregating lots across multiple products, customers, or suppliers

answer

True

question

Cycle inventory exists because producing or purchasing in large lots allows a stage of the supply chain to a. exploit economies of scale and raise cost. b. exploit economies of scale and lower cost. c. exploit customers and lower cost. d. exploit customers and raise cost. e. none of the above

answer

b. exploit economies of scale and lower cost.

question

Which of the following is not a situation in which any stage of the supply chain exploits economies of scale in its replenishment decisions? a. A fixed cost is incurred each time an order is placed or produced. b. A holding cost is incurred each period for each unit of inventory. c. The supplier offers price discounts based on the quantity purchased per lot. d. The supplier offers short-term discounts or holds trade promotions. e. all of the above

answer

b. A holding cost is incurred each period for each unit of inventory.

question

Economies of scale in purchasing and ordering motivate a manager to a. increase the lot size and cycle inventory. b. decrease the lot size and cycle inventory. c. eliminate inventory. d. increase the lot size and reduce cycle inventory. e. none of the above

answer

a. increase the lot size and cycle inventory.

question

The primary role of cycle inventory is to allow different stages in the supply chain to a. purchase product in lot sizes that maximize the sum of the material, ordering, and holding cost. b. purchase product in lot sizes that minimize the sum of the material, ordering, and holding cost. c. sell product in lot sizes that maximize the sum of the material, ordering, and holding cost. d. sell product in lot sizes that minimize the sum of the material, ordering, and holding cost. e. none of the above

answer

b. purchase product in lot sizes that minimize the sum of the material, ordering, and holding cost.

question

The quantity of inventory that a stage of the supply chain either produces or purchases at a given time is a. an order. b. a job. c. a shipment. d. a lot or batch. e. none of the above

answer

d. a lot or batch.

question

Cycle inventory is primarily held to a. take advantage of diseconomies of scale and increase cost within the supply chain. b. take advantage of diseconomies of scale and reduce cost within the supply chain. c. take advantage of economies of scale and increase cost within the supply chain. d. take advantage of economies of scale and reduce cost within the supply chain. e. None of the above are true.

answer

d. take advantage of economies of scale and reduce cost within the supply chain.

question

A graphical plot depicting the level of inventory over time is a. an inventory graph. b. a distribution inventory. c. an inventory drawing. d. an inventory profile. e. an inventory picture.

answer

d. an inventory profile.

question

The average inventory in the supply chain due to either production or purchases in lot sizes that are larger than those demanded by the customer is a. annual inventory. b. distribution inventory. c. cycle inventory. d. physical inventory. e. b and c only

answer

c. cycle inventory.

question

Aggregating across products, retailers, or suppliers in a single order allows for a reduction in lot size for individual products because a. fixed ordering and transportation costs are now charged to retailers. b. fixed ordering and transportation costs are now charged to suppliers. c. fixed ordering and transportation costs are now spread across multiple products, retailers, or suppliers. d. holding costs are now charged to retailers or suppliers. e. holding costs are now spread across multiple products, retailers, or suppliers.

answer

c. fixed ordering and transportation costs are now spread across multiple products, retailers, or suppliers.

question

Aggregating across products, retailers, or suppliers in a single order allows for a. an increase in lot size for individual products. b. an increase in customer demand. c. a reduction in holding cost per unit. d. a reduction in lot size for individual products. e. a reduction in purchase price per unit.

answer

d. a reduction in lot size for individual products.

question

Total ordering and holding costs a. are relatively stable. b. are relatively stable around the economic order quantity. c. are relatively unstable around the economic order quantity. d. are unstable. e. none of the above

answer

b. are relatively stable around the economic order quantity.

question

Which of the following would not be included in holding cost? a. cost of capital b. cost of physically storing the inventory c. cost of manufacturing d. cost that results from the product becoming obsolete e. none of the above

answer

c. cost of manufacturing

question

Which of the following would not be an example of a fixed ordering cost? a. administrative cost incurred to place an order b. trucking cost incurred to transport an order c. labor cost incurred to receive an order d. labor cost incurred to manufacture a part e. none of the above

answer

d. labor cost incurred to manufacture a part

question

A key to reducing cycle inventory is a. the reduction of holding cost. b. the reduction of manufacturing cost. c. the reduction of lot size. d. the reduction of warehouse space. e. all of the above

answer

c. the reduction of lot size.

question

The practice where a firm charges differential prices to maximize profits is a. lot pricing. b. marginal pricing. c. price incrimination. d. price discrimination. e. all of the above

answer

d. price discrimination.

question

For products where the firm has market power, coordination in the supply chain can be achieved and supply chain profits maximized through the use of a. two-part tariffs or volume based quantity discounts. b. marginal unit quantity discounts. c. all unit quantity discounts. d. basic quantity discounts. e. none of the above

answer

a. two-part tariffs or volume based quantity discounts.

question

In a supply chain where each stage of the supply chain independently makes its pricing decisions with the objective of maximizing its own profit, a. supply chain profit is lower than a coordinated solution. b. supply chain profit is higher than a coordinated solution. c. supply chain profit is about the same as a coordinated solution. d. supply chain profit will be maximized. e. None of the above are accurate.

answer

a. supply chain profit is lower than a coordinated solution.

question

For commodity products where price is set by the market, manufacturers can use lot size based quantity discounts to a. achieve coordination in the supply chain and decrease supply chain cost. b. relax coordination in the supply chain and increase supply chain cost. c. relax coordination in the supply chain and decrease supply chain cost. d. achieve coordination in the supply chain and decrease supply chain cost. e. None of the above are accurate.

answer

d. achieve coordination in the supply chain and decrease supply chain cost.

question

Quantity discounts lead to a. a significant buildup of cycle inventory in the supply chain. b. a slight buildup of cycle inventory in the supply chain. c. a decrease in cycle inventory in the supply chain. d. minor fluctuations of cycle inventory in the supply chain. e. a major drop in cycle inventory in the supply chain.

answer

a. a significant buildup of cycle inventory in the supply chain.

question

In the pricing schedule for marginal unit quantity discounts a. the average cost of a unit decreases at a breakpoint. b. the average cost of a unit increases at a breakpoint. c. the marginal cost of a unit decreases at a breakpoint. d. the marginal cost of a unit increases at a breakpoint. e. the average cost and the marginal cost of a unit decrease at a breakpoint.

answer

c. the marginal cost of a unit decreases at a breakpoint.

question

Pricing schedules with all unit quantity discounts encourage retailers to a. decrease the size of their lots. b. increase the size of their lots. c. decrease the size of their inventory. d. increase the price of their products. e. none of the above

answer

a. decrease the size of their lots.

question

A key to reducing lot size without increasing costs is to a. reduce the holding cost associated with each lot. b. reduce the fixed cost associated with each lot. c. reduce the material cost associated with each lot. d. reduce the manufacturing cost associated with each lot. e. increase the holding cost associated with each lot.

answer

b. reduce the fixed cost associated with each lot.

question

A price discount where the discount is based on the total quantity purchased over a given period, regardless of the number of lots purchased over that period is a. customer based. b. lot size based. c. supplier based. d. volume based. e. none of the above

answer

d. volume based.

question

A price discount where the pricing schedule offers discounts based on the quantity ordered in a single lot is a. customer based. b. lot size based. c. supplier based. d. volume based. e. none of the above

answer

b. lot size based.

question

Discounts related to price discrimination will be a. volume based. b. unit based. c. marginally based. d. lot size based. e. none of the above

answer

a. volume based.

question

Which of the following would not be a component of order cost? a. buyer time b. transportation cost c. handling cost d. receiving cost e. All of the above are components of order cost.

answer

c. handling cost

question

Which cost should reflect the incremental change in space cost due to changing cycle inventory? a. cost of capital b. obsolescence (spoilage) cost c. handling cost d. occupancy cost e. none of the above

answer

d. occupancy cost

question

Which cost should only include receiving and storage costs that vary with the quantity of product received? a. cost of capital b. obsolescence (spoilage) cost c. handling cost d. occupancy cost e. none of the above

answer

c. handling cost

question

Which cost estimates the rate at which the value of the product being stored drops either because the market value of that product drops or because the product quality deteriorates? a. cost of capital b. obsolescence (spoilage) cost c. handling cost d. occupancy cost e. none of the above

answer

b. obsolescence (spoilage) cost

question

Which cost takes into account the return demanded on the firm's equity and the amount the firm must pay on its debt? a. cost of capital b. obsolescence (spoilage) cost c. handling cost d. occupancy cost e. none of the above

answer

a. cost of capital

question

When developing estimates for holding and ordering costs, it is important to a. estimate these costs to a high level of precision. b. get a good approximation quickly. c. develop estimates that will not be changed. d. both a and c e. none of the above

answer

b. get a good approximation quickly.

question

The goal of trade promotions is to a. influence retailers to act in a way that helps the retailer achieve its objectives. b. influence retailers to act in a way that helps the manufacturer achieve its objectives. c. influence retailers to act in a way that will maximize supply chain profit. d. influence retailers to act in a way minimize supply chain cost. e. none of the above

answer

b. influence retailers to act in a way that helps the manufacturer achieve its objectives.

question

Replenishment orders in multi-echelon supply chains should be a. synchronized to increase cycle inventory and order costs. b. synchronized to facilitate supplier evaluation and selection. c. synchronized to keep cycle inventory and order costs low. d. separated to increase cycle inventory and order costs. e. separated to keep cycle inventory and order costs low.

answer

c. synchronized to keep cycle inventory and order costs low.

question

The retailer can justify the forward buying when a. they have inadvertently built up a lot of excess inventory. b. the forward buy allows the manufacturer to smooth demand by shifting it from peak to low-demand periods. c. it decreases his total cost. d. all of the above e. a and c only

answer

c. it decreases his total cost.

question

The manufacturer can justify offering trade promotions resulting in forward buying by retailers when a. they have inadvertently built up a lot of excess inventory. b. the forward buy allows the manufacturer to smooth demand by shifting it from peak to low-demand periods. c. the retailer decreases his total cost. d. all of the above e. a and b only

answer

e. a and b only

question

When the retailer decides to pass through very little of the promotion to customers but purchase in greater quantity during the promotion period to exploit the temporary reduction in price, the result is a. a lowering of the price of the product for the end customer. b. increased purchases and thus increased sales for the entire supply chain. c. an increase in the amount of inventory held at the retailer. d. all of the above e. a and b only

answer

c. an increase in the amount of inventory held at the retailer.

question

When the retailer decides to pass through some or all of the promotion to customers to spur sales, the result is a. a lowering of the price of the product for the end customer. b. increased purchases and thus increased sales for the entire supply chain. c. an increase in the amount of inventory held at the retailer. d. all of the above e. a and b only

answer

e. a and b only

question

Which of the following is a possible response that a retailer could make to a trade promotion? a. Pass through some or all of the promotion to customers to spur sales. b. Pass through very little of the promotion to customers but purchase in greater quantity during the promotion period to exploit the temporary reduction in price. c. Shift inventory from the retailer to the customer. d. a and b only e. b and c only

answer

d. a and b only

question

Which of the following is not a key goal (from the manufacturer's perspective) of a trade promotion? a. Induce retailers to use price discounts, displays, or advertising to spur sales. b. Shift inventory from the manufacturer to the retailer and the customer. c. Shift inventory from the retailer to the customer. d. Defend a brand against competition. e. none of the above

answer

c. Shift inventory from the retailer to the customer.

question

Safety inventory is inventory carried for the purpose of satisfying demand that exceeds the amount forecasted for a given period.

answer

True

question

A shortage occurs in a replenishment cycle only if the demand during the lead time exceeds the ROP

answer

True

question

The expected shortage per replenishment cycle (ESC) is the average units of demand that are satisfied from inventory in stock per replenishment cycle.

answer

False

question

With periodic review, inventory status is checked at regular intervals and an order is placed to raise the inventory level to a specified threshold.

answer

True

question

With continuous review, inventory is continuously tracked and an order for a lot size Q is placed at regular intervals of time

answer

False

question

Tracking order fill rates is important when customers place a high value on the entire order being filled simultaneously

answer

True

question

The distinction between product fill rate and order fill rate is significant in a single product situation.

answer

False

question

Product fill rate is the fraction of product demand that is satisfied from product in inventory.

answer

True

question

Order fill rate is the fraction of product demand that is satisfied from product in inventory.

answer

False

question

Product availability reflects a firm's ability to fill a customer order out of available inventory.

answer

True

question

Safety inventory is carried because demand forecasts are accurate and a product shortage may result if the forecast demand exceeds the actual demand

answer

False

question

Lead time is the gap between when an order is placed and when it is received.

answer

True

question

As the desired level of product availability increases, the required level of safety inventory decreases.

answer

False

question

As the uncertainty of supply or demand grows, the required level of safety inventories increases.

answer

True

question

The appropriate level of safety inventory is determined by the uncertainty of both demand and supply and the desired level of cycle inventory.

answer

False

question

Carrying excessive inventory can help counter demand volatility when new products come on the market.

answer

False

question

Raising the level of safety inventory increases inventory holding costs.

answer

True

question

Raising the level of safety inventory increases product availability and thus the margin captured from customer purchases.

answer

True

question

The fill rate increases and the cycle service level decreases as the safety inventory is increased.

answer

False

question

15. When using a continuous review policy, a manager has to account for the uncertainty of demand during the lead time and the review interval.

answer

False

question

Periodic review policies require more safety inventory than continuous review policies for the same level of product availability.

answer

True

question

13. Postponement allows the supply chain to delay product differentiation, which results in disaggregating most of the inventories in the supply chain.

answer

False

question

12. Manufacturer-driven substitution increases overall profitability for the manufacturer by allowing some aggregation of demand, which reduces the inventory requirements for the same level of availability.

answer

True

question

10. If aggregation reduces the required safety inventory for a product by a small amount, it may be best to carry the product in multiple decentralized locations to reduce response time and transportation cost.

answer

True

question

8. Aggregation reduces the standard deviation of demand only if demand across the regions being aggregated is not perfectly positively correlated.

answer

True

question

For the same safety inventory, an increase in lot size increases the fill rate but not the cycle service level.

answer

True

question

7. A reduction in supply can help dramatically reduce safety inventory required without hurting product availability.

answer

False

question

6. In most supply chains, the key to reducing the underlying forecast uncertainty is to link all forecasts throughout the supply chain to customer demand data.

answer

True

question

A goal of any supply chain manager is to reduce the level of safety inventory required regardless of the affect product availability.

answer

False

question

The required safety inventory increases with an increase in the lead time and the standard deviation of periodic demand.

answer

True

question

The required safety inventory grows rapidly with a decrease in the desired product availability.

answer

False

question

Inventory carried for the purpose of satisfying demand that exceeds the amount forecasted for a given period is a. cycle inventory. b. demand inventory. c. safety inventory. d. security inventory. e. all of the above

answer

c. safety inventory.

question

Lead time is the gap between a. when an order is placed and when it is received. b. when an order is received and when it is put away. c. when an order is received and when it is used. d. when an order is acknowledged and when it is received. e. none of the above

answer

a. when an order is placed and when it is received.

question

As the desired level of product availability increases, the required level of safety inventory a. decreases. b. increases. c. remains stable. d. both a and b e. none of the above

answer

e. none of the above

question

8. As the uncertainty of supply or demand grows, the required level of safety inventories a. decreases. b. increases. c. remains stable. d. both a and b e. none of the above

answer

b. increases.

question

7. The appropriate level of safety inventory is determined by a. the uncertainty of both demand and supply. b. the desired level of product availability. c. the desired level of cycle inventory. d. the processes in a supply chain are divided into 2 categories depending all of the above e. a and b only

answer

e. a and b only

question

What key question(s) need(s) to be considered when planning safety inventory for any supply chain? a. What is the appropriate lead time to establish? b. What is the appropriate level of safety inventory to carry? c. What actions can be taken to improve product availability while reducing safety inventory? d. a and b only e. b and c only

answer

e. b and c only

question

Safety inventory is carried because a. demand forecasts are accurate. b. demand forecasts are uncertain. c. adequate supplies are available. d. excess product was manufactured. e. forecast demand exceeds the actual demand.

answer

b. demand forecasts are uncertain.

question

A key to success at which company has been its ability to provide a high level of product availability to customers while carrying very low levels of safety inventory in its supply chain? a. Compaq b. Hewlett-Packard c. Dell d. Packard-Bell e. all of the above

answer

c. Dell

question

4. The issue of product availability and the level of safety inventory is particularly significant in industries where a. product life cycles are short and demand is stable. b. product life cycles are short and demand is very volatile. c. product life cycles are long and demand is stable. d. product life cycles are long and demand is very volatile. e. a and b only

answer

b. product life cycles are short and demand is very volatile.

question

The trade-off that a supply chain manager must consider when planning safety inventory is a. increasing product availability versus increasing inventory holding costs. b. decreasing product availability versus decreasing inventory holding costs. c. increasing product availability versus raising the level of safety inventory. d. decreasing product availability versus decreasing the level of safety inventory. e. none of the above

answer

a. increasing product availability versus increasing inventory holding costs.

question

10. A company that checks inventory status at regular periodic intervals and places an order to raise the inventory level to a specified threshold is using a. continuous review. b. daily review. c. occasional review. d. periodic review. e. none of the above

answer

d. periodic review.

question

9. A company that tracks inventory and places an order for a lot size Q when the inventory declines to the reorder point (ROP) is using a. continuous review. b. daily review. c. occasional review. d. periodic review. e. none of the above

answer

a. continuous review.

question

A replenishment policy a. consists of decisions regarding when to reorder and how much to reorder. b. determines the cycle and safety inventories along with the fr and the CSL. c. may take several forms. d. All of the above are true. e. None of the above are true.

answer

d. All of the above are true.

question

The distinction between product fill rate and order fill rate is a. not significant in a single product situation. b. significant in a single product situation. c. not significant when a firm is selling multiple products. d. significant when a firm is selling multiple products. e. both a and d

answer

a. not significant in a single product situation.

question

If a customer order arrives when product is not available a. a sale results. b. the retailer allocates product to the customer. c. a stockout results. d. the order is filled from safety inventory. e. none of the above

answer

c. a stockout results.

question

Which of the following is not a measure of product availability? a. customer fill rate b. product fill rate c. order fill rate d. cycle service level (CSL) e. none of the above

answer

a. customer fill rate

question

5. The fraction of replenishment cycles that end with all the customer demand being met is the a. customer fill rate. b. product fill rate. c. order fill rate. d. cycle service level (CSL). e. none of the above

answer

d. cycle service level (CSL).

question

The fraction of product demand that is satisfied from product in inventory is the a. customer fill rate. b. product fill rate. c. order fill rate. d. cycle service level (CSL). e. none of the above

answer

b. product fill rate.

question

The fraction of orders that are filled from available inventory is the a. customer fill rate. b. product fill rate. c. order fill rate. d. cycle service level (CSL). e. none of the above

answer

c. order fill rate.

question

1. The expected shortage per replenishment cycle (ESC) is a. the units of demand that are not satisfied from inventory in stock in a given replenishment cycle. b. the units of demand that are satisfied from inventory in stock in a given replenishment cycle. c. the average units of demand that are not satisfied from inventory in stock per replenishment cycle. d. the average units of demand that are satisfied from inventory in stock per replenishment cycle. e. none of the above

answer

c. the average units of demand that are not satisfied from inventory in stock per replenishment cycle.

question

10. A goal of any supply chain manager is to a. increase the level of safety inventory required in a way that does not adversely affect product availability. b. increase the level of safety inventory required regardless of the effect on product availability. c. reduce the level of safety inventory required regardless of the effect on product availability. d. reduce the level of safety inventory required in a way that does not adversely affect product availability. e. none of the above

answer

d. reduce the level of safety inventory required in a way that does not adversely affect product availability.

question

The required safety inventory a. increases with an increase in the lead time and the standard deviation of periodic demand. b. decreases with an increase in the lead time and the standard deviation of periodic demand. c. remains stable with an increase in the lead time and the standard deviation of periodic demand. d. increases with a decrease in the lead time and the standard deviation of periodic demand. e. none of the above

answer

d. increases with a decrease in the lead time and the standard deviation of periodic demand.

question

The required safety inventory a. grows rapidly with a decrease in the desired product availability. b. grows rapidly with an increase in the desired product availability. c. decreases with an increase in the desired product availability. d. remains stable with an increase in the desired product availability. e. none of the above

answer

b. grows rapidly with an increase in the desired product availability.

question

For the same safety inventory, an increase in lot size a. decreases the fill rate but not the cycle service level. b. increases the fill rate but not the cycle service level. c. decreases both the fill rate and the cycle service level. d. increases both the fill rate and the cycle service level. e. none of the above

answer

c. decreases both the fill rate and the cycle service level.

question

5. As the safety inventory is increased a. fill rate increases and cycle service level decreases. b. fill rate decreases and cycle service level increases. c. both fill rate and cycle service level increase. d. both fill rate and cycle service level decrease. e. none of the above

answer

c. both fill rate and cycle service level increase.

question

4. A shortage occurs in a replenishment cycle a. only if the demand during the lead time exceeds the ROP. b. only if the demand during the lead time is less than the ROP. c. only if the demand during the lead time exceeds the average demand. d. only if the demand during the lead time is less than the average demand. e. none of the above

answer

a. only if the demand during the lead time exceeds the ROP.

question

Which of the following is not an approach to reduce the level of safety inventory required in a way that does not adversely affect product availability? a. Reduce the supplier lead time. b. Reduce the underlying uncertainty of demand. c. Reduce the cost of material coming from suppliers. d. All of the above are approaches. e. None of the above are approaches.

answer

c. Reduce the cost of material coming from suppliers.

question

18. As retailers decrease the level of safety inventory they carry, the distributor will have to a. decrease his or her safety inventory. b. increase his or her safety inventory. c. keep his or her safety inventory at the same level. d. increase his or her cycle inventory. e. decrease his or her cycle inventory.

answer

b. increase his or her safety inventory.

question

17. A distributor should decide his safety inventory levels based on a. the level of safety inventory carried by all retailers supplied by him. b. the level of safety inventory carried by other distributors. c. the level of safety inventory carried by manufacturers supplying him. d. the level of cycle inventory carried by all retailers supplied by him. e. the level of cycle inventory carried by other distributors.

answer

a. the level of safety inventory carried by all retailers supplied by him.

question

16. All inventory between a given stage in the supply chain and the final customer is called the a. cycle inventory. b. demand inventory. c. echelon inventory. d. safety inventory. e. none of the above

answer

c. echelon inventory.

question

15. Periodic review policies require a. more safety inventory than continuous review policies for the same level of product availability. b. less safety inventory than continuous review policies for the same level of product availability. c. the same safety inventory as continuous review policies for the same level of product availability. d. no more safety inventory than continuous review policies for the same level of product availability. e. none of the above

answer

a. more safety inventory than continuous review policies for the same level of product availability.

question

14. Continuous review policies for inventory replenishment require safety inventory to cover demand during a. lead time only. b. the review interval only. c. both lead time and the review interval. d. neither lead time or the review interval. e. lead time when it exceeds the review interval.

answer

a. lead time only.

question

Periodic review policies for inventory replenishment require safety inventory to cover demand during a. lead time only. b. the review interval only. c. both lead time and the review interval. d. neither lead time or the review interval. e. lead time when it exceeds the review interval.

answer

c. both lead time and the review interval.

question

12. Which approach to aggregation has the goal of moving product differentiation as close to the pull phase of the supply chain as possible? a. information centralization b. specialization c. product substitution d. component commonality e. postponement

answer

e. postponement

question

2. Often, safety inventory calculations in practice a. do not include any measure of supply uncertainty, resulting in levels that may be higher than required. b. do not include any measure of supply uncertainty, resulting in levels that may be lower than required. c. include measures of supply uncertainty, resulting in levels that may be higher than required. d. include any measures of supply uncertainty, resulting in levels that may be lower than required. e. None of the above are accurate.

answer

b. do not include any measure of supply uncertainty, resulting in levels that may be lower than required.

question

The ability of a supply chain to delay product differentiation or customization until closer to the time the product is sold is a. information centralization. b. specialization. c. product substitution. d. component commonality. e. postponement.

answer

e. postponement.

question

Which use of common components in a variety of products has been a very effective supply chain strategy to exploit aggregation and reduce component inventories? a. information centralization b. specialization c. product substitution d. component commonality e. postponement

answer

a. information centralization

question

The use of one product to satisfy demand for a different product is a. information centralization. b. specialization. c. product substitution. d. component commonality. e. postponement.

answer

c. product substitution.

question

Which approach to aggregation would stock the fast-moving items at decentralized locations close to the customer and slow-moving items at a centralized location? a. information centralization b. specialization c. product substitution d. component commonality e. postponement

answer

b. specialization

question

Which approach to aggregation requires an information system that allows access to current inventory records from each location? a. information centralization b. specialization c. product substitution d. component commonality e. postponement

answer

a. information centralization

question

6. Which of the following is not a method by which a supply chain can extract the benefits of aggregation without having to physically centralize all inventories in one location? a. information centralization b. specialization c. product substitution d. component differentiation e. postponement

answer

d. component differentiation

question

Which of the following is not a major disadvantage of aggregating all inventory in one location? a. Increase in forecast accuracy of customer demand. b. Increase in response time to customer order. c. Increase in transportation cost to customer. d. All of the above are disadvantages. e. All of the above are advantages.

answer

a. Increase in forecast accuracy of customer demand.

question

Aggregation reduces the standard deviation of demand a. only if demand across the regions being aggregated is perfectly positively correlated. b. only if demand across the regions being aggregated is not perfectly positively correlated. c. even if demand across the regions being aggregated is not perfectly positively correlated. d. whenever demand across the regions being aggregated is not perfectly positively correlated. e. All of the above are accurate.

answer

b. only if demand across the regions being aggregated is not perfectly positively correlated.

question

The level of product availability is also referred to as the customer service level.

answer

True

question

23. In product-based tailored sourcing, low-volume products with uncertain demand are obtained from a flexible source, while high-volume products with less demand uncertainty are obtained from an efficient source.

answer

True

question

In volume-based tailored sourcing, the predictable part of a product's demand is produced at a flexible facility, whereas the uncertain portion is produced at an efficient facility.

answer

False

question

21. Tailored sourcing may be volume-based or product-based depending on the source of uncertainty.

answer

True

question

20. In tailored sourcing, firms use a combination of two supply sources, one focusing on cost and able to handle uncertainty well, and the other focusing on flexibility to handle uncertainty, but at a higher cost. Answer: False Difficulty: Moderate

answer

False

question

19. Tailored postponement allows a firm to increase its profitability by only postponing the uncertain part of the demand and producing the predictable part at a lower cost without postponement.

answer

True

question

18. Postponement may increase overall profits for a firm if a single product contributes the majority of the demand because the increased manufacturing expense due to postponement outweighs the small benefit that aggregation provides in this case.

answer

False

question

17. Postponement is valuable for a firm that sells a large variety of products with demand that is independent and comparable in size.

answer

True

question

There is a cost associated with postponement because the production cost using postponement is typically lower than the production cost without it.

answer

False

question

Quick response results in the manufacturer making a lower profit in the short term if all else is unchanged.

answer

True

question

A supply chain can use a high level of product availability to improve its responsiveness and attract customers.

answer

True

question

If quick response allows multiple orders in the season, profits increase and the overstock quantity increases.

answer

False

question

Supply chain managers are able to increase their forecast accuracy as lead times decrease, which allows them to better match supply with demand and increase supply chain profitability.

answer

True

question

An increase in forecast accuracy increases both the overstocked and understocked quantity and decreases a firm's profits.

answer

False

question

With reduced demand uncertainty, a supply chain manager can better match supply and demand by reducing both overstocking and understocking.

answer

True

question

As the ratio of the cost of overstocking to the cost of understocking gets smaller, the optimal level of product availability decreases.

answer

False

question

9. The costs of overstocking and understocking have a direct impact on both the optimal cycle service level and profitability.

answer

True

question

8. The cost of underselling is a key factor that influences the optimal level of product availability.

answer

False

question

5. Whether the optimal level of availability is high or low depends on where a particular company believes they can maximize profits.

answer

True

question

A supply chain needs to achieve a balance between the level of availability and the cost of inventory that maximizes supply chain revenues.

answer

False

question

A high level of product availability requires less inventory, which will keep costs down for the supply chain.

answer

False

question

The level of product availability a. is also referred to as the customer service level. b. is an important component of any supply chain's responsiveness. c. increases revenues for the supply chain by increasing sales. d. All of the above are true. e. Only a and b are true.

answer

e. Only a and b are true.

question

20. A company with multiple products, that chooses to delay product differentiation until closer to the point of sale, is using a. tailored sourcing. b. quick response. c. postponement. d. improved forecasting. e. decreased margin.

answer

c. postponement.

question

19. A company that reduces replenishment lead time so that multiple orders may be placed in the selling season is making use of a. tailored sourcing. b. quick response. c. postponement. d. improved forecasting. e. decreased margin.

answer

b. quick response.

question

18. A company that uses better market intelligence and collaboration to reduce demand uncertainty is making use of a. tailored sourcing. b. quick response. c. postponement. d. improved forecasting. e. decreased margin.

answer

d. improved forecasting.

question

17. With reduced demand uncertainty, a supply chain manager can a. increase both overstocking and understocking. b. increase overstocking and reduce understocking. c. reduce overstocking and increase understocking. d. reduce both overstocking and understocking. e. none of the above

answer

d. reduce both overstocking and understocking.

question

16. Which of the following is not an approach to reduce the uncertainty of demand? a. tailored sourcing b. quick response c. postponement d. improved forecasting e. decreased margin

answer

e. decreased margin

question

15. As the ratio of the cost of overstocking to the cost of understocking gets smaller, a. the optimal level of product availability becomes irrelevant. b. the optimal level of product availability decreases. c. the optimal level of product availability remains stable. d. the optimal level of product availability increases. e. none of the above

answer

d. the optimal level of product availability increases.

question

A supply chain can use a high level of product availability to a. improve its responsiveness and attract customers. b. reduce costs for the supply chain by reducing inventories. c. increase revenues for the supply chain by increasing sales. d. All of the above are true. e. Only a and c are true.

answer

e. Only a and c are true.

question

14. Which of the following would be a strategy to decrease the margin lost in a stockout? a. arranging for backup sourcing b. discarding the unused material c. selling unsold product to an outlet store d. reduce the level of cycle inventory e. none of the above

answer

a. arranging for backup sourcing

question

13. Which of the following would be a strategy to increase the salvage value of an unsold product? a. discarding the unused material b. selling unsold product to an outlet store c. keeping the product in inventory until it sells d. reduce the level of cycle inventory e. none of the above

answer

b. selling unsold product to an outlet store

question

Which of the following is not a managerial lever to increase profitability? a. increasing the salvage value of each unit b. decreasing the margin lost from a stockout c. reducing demand uncertainty d. reducing the level of product availability below optimal e. increasing forecast accuracy

answer

d. reducing the level of product availability below optimal

question

11. The costs of overstocking and understocking have a direct impact on a. the optimal cycle service level but not profitability. b. profitability but not the optimal cycle service level. c. both the optimal cycle service level and profitability. d. neither the optimal cycle service level or profitability. e. the optimal cycle service level and an indirect impact on profitability.

answer

c. both the optimal cycle service level and profitability.

question

10. Which of the following is not a situation involving the trade-off between the cost of overstocking and the cost of understocking? a. seasonal products where all leftover items must be disposed of at the end of the season b. continuously stocked items where demand during stockout is backlogged c. continuously stocked items where demand during stockout is lost d. continuously stocked items where demand during stockout is redirected e. none of the above

answer

d. continuously stocked items where demand during stockout is redirected

question

The margin lost from current as well as future sales if the customer does not return should be included in a. the cost of overstocking the product. b. the cost of stocking the product. c. the cost of understocking the product. d. the cost of overselling the product. e. the cost of underselling the product.

answer

c. the cost of understocking the product.

question

8. The margin lost by a firm for each lost sale because there is no inventory on hand is a. the cost of overstocking the product. b. the cost of stocking the product. c. the cost of understocking the product. d. the cost of overselling the product. e. the cost of underselling the product.

answer

c. the cost of understocking the product.

question

The loss incurred by a firm for each unsold unit at the end of the selling season is a. the cost of overstocking the product. b. the cost of stocking the product. c. the cost of understocking the product. d. the cost of overselling the product. e. the cost of underselling the product.

answer

a. the cost of overstocking the product.

question

The key factors that influence the optimal level of product availability do not include a. the cost of overstocking the product. b. the cost of stocking the product. c. the cost of understocking the product. d. All of the above are key factors. e. None of the above are key factors.

answer

b. the cost of stocking the product.

question

5. Whether the optimal level of product availability is high or low depends on where a particular company believes they can a. minimize cost. b. maximize revenue. c. maximize profits. d. maximize product availability. e. all of the above

answer

c. maximize profits.

question

A high level of product availability requires a. large inventories and tends to raise costs for the supply chain. b. large inventories and tends to reduce costs for the supply chain. c. small inventories and tends to raise costs for the supply chain. d. small inventories and tends to reduce costs for the supply chain. e. none of the above

answer

a. large inventories and tends to raise costs for the supply chain.

question

A supply chain needs to achieve a balance between the level of availability and the cost of inventory that a. maximizes supply chain revenues. b. minimizes supply chain costs. c. maximizes supply chain profitability. d. maximizes supply chain availability. e. all of the above

answer

c. maximizes supply chain profitability.

question

1. A company that uses a more expensive short lead time supplier as a backup for a low cost, long lead time supplier is using a. tailored sourcing. b. quick response. c. postponement. d. improved forecasting. e. decreased margin.

answer

a. tailored sourcing.

question

17. In product-based tailored sourcing a. low-volume products with uncertain demand are obtained from a flexible source. b. high-volume products with less demand uncertainty are obtained from an efficient source. c. high-volume products with less demand uncertainty are obtained from a flexible source. d. all of the above e. a and b only

answer

e. a and b only

question

16. In volume-based tailored sourcing a. the predictable part of a product's demand is produced at an efficient facility. b. the uncertain portion is produced at a flexible facility. c. the predictable part of a product's demand is produced at a flexible facility. d. all of the above e. a and b only

answer

e. a and b only

question

15. In tailored sourcing, firms use a combination of two supply sources, a. one focusing on cost but unable to handle uncertainty well, and the other focusing on flexibility to handle uncertainty, but at a higher cost. b. one focusing on cost and able to handle uncertainty well, and the other focusing on flexibility to handle uncertainty, but at a higher cost. c. one focusing on cost but unable to handle uncertainty well, and the other focusing on flexibility to handle uncertainty at a lower cost. d. one focusing on cost and able to handle uncertainty well, and the other focusing on flexibility to handle uncertainty at a lower cost. e. None of the above are accurate.

answer

a. one focusing on cost but unable to handle uncertainty well, and the other focusing on flexibility to handle uncertainty, but at a higher cost.

question

14. Under tailored postponement, a firm produces the amount that is very likely to sell using a. the lower cost production method with postponement and produces the portion of demand that is uncertain using postponement. b. the lower cost production method without postponement and produces the portion of demand that is uncertain using postponement. c. the higher cost production method with postponement and produces the portion of demand that is uncertain using postponement. d. the higher cost production method without postponement and produces the portion of demand that is uncertain using postponement. e. All of the above are accurate.

answer

b. the lower cost production method without postponement and produces the portion of demand that is uncertain using postponement.

question

13. When a firm uses production with postponement to satisfy a part of its demand with the rest being satisfied without postponement, it is using a. adjustable postponement. b. flexible postponement. c. managed postponement. d. tailored postponement. e. none of the above

answer

d. tailored postponement.

question

12. Postponement is a. not very effective if a large fraction of demand comes from multiple products. b. not very effective if a small fraction of demand comes from a single product. c. only effective if a large fraction of demand comes from a single product. d. effective even if a large fraction of demand comes from a single product.

answer

b. not very effective if a small fraction of demand comes from a single product.

question

11. Postponement is valuable for a firm that a. sells a large variety of products with demand that is dependent and comparable in size. b. sells a large variety of products with demand that is independent and comparable in size. c. sells a small variety of products with demand that is dependent and comparable in size. d. sells a small variety of products with demand that is independent and comparable in size. e. focuses on processes that are internal to the firm.

answer

b. sells a large variety of products with demand that is independent and comparable in size.

question

10. There is a cost associated with postponement because the production cost using postponement is typically a. higher than the production cost without it. b. lower than the production cost without it. c. very stable. d. equal to the production cost without it. e. none of the above

answer

a. higher than the production cost without it.

question

9. Quick response results in a. the manufacturer making a lower profit in the long term if all else is unchanged. b. the manufacturer making a lower profit in the short term if all else is unchanged. c. the retailer making a lower profit in the short term if all else is unchanged. d. the distributor making a lower profit in the short term if all else is unchanged. e. none of the above

answer

b. the manufacturer making a lower profit in the short term if all else is unchanged.

question

8. Quick response is clearly advantageous to a. a distributor in the supply chain. b. a retailer in the supply chain. c. a manufacturer in the supply chain. d. every step in the supply chain. e. none of the above

answer

b. a retailer in the supply chain.

question

2. An increase in forecast accuracy a. decreases both the overstocked and understocked quantity and decreases a firm's profits. b. decreases both the overstocked and understocked quantity and increases a firm's profits. c. increases both the overstocked and understocked quantity and decreases a firm's profits. d. increases both the overstocked and understocked quantity and increases a firm's profits. e. none of the above

answer

b. decreases both the overstocked and understocked quantity and increases a firm's profits.

question

7. If quick response allows multiple orders in the season, a. profits decrease and the overstock quantity decreases. b. profits decrease and the overstock quantity increases. c. profits increase and the overstock quantity decreases. d. profits increase and the overstock quantity increases. e. none of the above

answer

c. profits increase and the overstock quantity decreases.

question

6. As the total quantity for the season is broken up into multiple smaller orders, the buyer is better able to a. match supply and demand and increase cost. b. match supply and demand and increase profitability. c. match supply and demand and decrease profitability. d. match supply and demand and decrease product availability. e. none of the above

answer

b. match supply and demand and increase profitability.

question

5. Which of the following is not a consequence of being able to place a second order during the season for a seasonal product? a. The expected total quantity ordered during the season with two orders is less. b. The average overstock to be disposed of at the end of the sales season is less. c. The profits are higher. d. The average inventory level is higher. e. none of the above

answer

d. The average inventory level is higher.

question

4. As lead times decrease, supply chain managers are able to a. better match supply with demand. b. better match demand with supply. c. increase supply chain cost. d. decrease product availability. e. none of the above

answer

a. better match supply with demand.

question

3. Supply chain managers are able to a. increase their forecast accuracy as lead times increase. b. increase their forecast accuracy as lead times decrease. c. decrease their forecast accuracy as lead times decrease. d. decrease their forecast accuracy as lead times increase. e. a product is received into stock at a store.

answer

b. increase their forecast accuracy as lead times decrease.

STUDY

Direct Marketing Channel Economic Order Quantity Marketing Principles Of Marketing Radio Frequency Identification Vertical Marketing Systems

mini test 8 (1,2,R1) – Flashcards 40 terms

Alexandra Robertson

40 terms

Preview

mini test 8 (1,2,R1) – Flashcards

question

_____________ occurs when there is a clash of goals and methods between distribution channel members. Select one: a. Disintermediation b. Channel conflict c. Cognitive dissonance d. Administered systems e. Whining.

answer

question

Starbucks recently announced that it intends to grow from 21,000 to 30,000 stores world wide by the year 2020. Even though it seems as if there is a Starbucks on every corner in America, the company feels there is a need for more outlets. This is an example of ___________ distribution. Select one: a. Selective b. Exhaustive c. Exclusive d. Caffeinated e. Intensive

answer

question

The supply chain centers on the producer. Downstream activities consist of? Select one: a. The flow of finished product from the producer to the end user b. Quality control and service monitoring after production begins c. The flow of raw materials from the supplier to the producer d. The channel flows that deal with the physical product. e. Actions that will allow the company to exit from an unattractive market.

answer

question

Kendra runs a wholesale distribution center for candy. Each week she receives candy from all of the major manufacturers. She stamps a date sticker on each package so the retailers will know how fresh the candy is. She also provides information on how much cocoa is in the chocolate from the various manufacturers. Kendra is adding value by ___________? Select one: a. Breaking bulk b. Transporting c. Grading. d. Creating assortment e. Storing

answer

question

With _________________ the roles of the various channel partners are specified by a formal contract. Select one: a. Vertical marketing systems b. Franchises c. Co-operative associations d. The roles of the channel partners are specified by contract in all of these situations.

answer

question

Unlike a storage warehouse, a distribution center is primarily for? Select one: a. Climate control b. Storage c. Vertical integration d. Transshipment of products e. Reintermediation

answer

question

When I order a book from Amazon.com, an online marketplace, I receive an order confirmation that tells me when my package will leave the Amazon warehouse, the name of the shipper, and a link to the shipper's website that allows me to track the progress of my package from the warehouse to my home. This way I know exactly when to expect my package. This is an example of the use of ____________ to smooth the flow of goods and services through the channel of distribution? Select one: a. Payment b. Information c. Intermediation. d. Permission e. Warehousing

answer

question

Which of the following is NOT an example of a third-party provider of logistics? Select one: a. A design firm b. A public warehouse. c. An export/import firm d. A parcel delivery company e. A freight forwarder

answer

question

The biggest difference between a merchant wholesaler and an agent or broker is that the merchant wholesaler? Select one: a. Is paid a commission on what it sells b. Deals with more than one company's products. c. Doesn't have to call on customers. d. Takes ownership of the products it carries. e. Doesn't bring buyers and sellers together.

answer

question

BruceCo is an inventory liquidator. The company identifies other businesses that have huge amounts of unsold inventory and buys it from them at pennies on the dollar. They then try to find another company that can use the inventory and sell it to them at a profit. What makes this business so fun is that you never know from day to day what product you will be dealing in or who might be a prospective customer. What type of wholesaler would BruceCo be considered? Select one: a. Work with a broker to negotiate deals with any customer who wishes to purchase what BruceCo is trying to liquidate. b. Work with a distributor who carries a variety of products and sells to a variety of customers. c. Sell directly to customers through a company website and charge $10 shipping and handling for ground delivery and $20 shipping and handling for rush delivery. d. Set up a series of regional warehouses to keep inventory nearer to the customer. e. Hire a manufacturer's representative to call manufacturing businesses send the orders into BruceCo.

answer

question

Which of the following is an example of a direct marketing channel? Select one: a. These are all direct channels of distribution. b. My niece Polly who sells hand-made jewelry at tables she rents at craft shows and art fairs. c. My brother in law Don who custom builds homes for customers on their property. d. The Avon Corporation which has company-paid salespeople sell cosmetics door to door e. The Dell Corporation which sells computers to consumers through its company owned website.

answer

question

I can't believe it, said Wiley Coyote, I am the president of Acme enterprises and we make $200,000 a year profit with me working my tail off. Our distributor, Road Runner Representatives, made over $800,000 in commissions. I don't understand why they are making all of that money when all they do is run around all day and say beep-beep to customers. I think we should lower the commission rate to bring their income down to a more reasonable level. This is an example of? Select one: a. Horizontal conflict b. Vertical conflict. c. A price war d. Suspended animation e. Vertical integration

answer

question

In marketing channels where there are both large players and small players, a(n) ___________, usually the largest member of the channel will assume responsibility for coordinating activities in the channel? Select one: a. Opinion leader. b. Vertical marketing system c. Intermediary d. Channel captain e. System administrator

answer

question

One of the ways intermediaries create value is to? Select one: a. Decrease the number of transactions needed to create an efficient market. b. Provide a buffer between consumer and producer so individuals don't feel like they are dealing with a large corporation. c. Invest in trucks that are much more expensive than other companies in the channel can afford. d. Increase the amount of money customers are willing to pay for a good or service. e. These are all ways that intermediaries create value.

answer

question

Kendra runs a wholesale distribution center for candy. Each week she receives candy from all of the major manufacturers. She stamps a date sticker on each package so the retailers will know how fresh the candy is. She also provides information on how much cocoa is in the chocolate from the various manufacturers. Kendra is adding value by ___________? Select one: a. Breaking bulk b. Storing c. Creating assortment d. Grading. e. Transporting

answer

question

The decision to hold inventory is critical to providing customer service through the supply chain. There are both costs and benefits. Which of these is NOT a benefit of holding inventory? Select one: a. To create time utility for customers b. Serve as a buffer against supply interruptions c. Make it possible to save money buy buying in volume. d. Serve as a hedge against inflation for price-sensitive goods. e. To create possession utility for producers

answer

question

Materials handling deals with loading and unloading products and moving them short distances from place to place. One of the biggest issues in material handling is? Select one: a. Damage control b. Breakage c. All of these are issues associated with materials handling d. Keeping track of where things are e. Theft

answer

question

Coca Cola's basic strategy is they you should never be more than an arms length away from a cold, refreshing Coke. In order to achieve this strategy they try to make Coke products available for sale through as many outlets as possible. You can buy bottled Coke in the grocery store, fountain coke at a restaurant, single cans and bottles at convenience stores and gas stations, and individual cans from vending machines while you are waiting in line for a ride at an amusement park. Because the goal of the supply chain is to maximize __________, Coke is willing to bear the expense of having several different channels of distribution? Select one: a. Variety b. Responsiveness c. Downstream activities. d. Efficiency. e. Upstream activities

answer

question

Carlina operates a wholesale lumber business serving contractors in her Midwestern city. She takes orders from a central location and delivers the lumber and other building materials to the contractor's jobsite using her own trucks. She orders her lumber from a mill in Washington State. Because the lumber is bulky and she orders large quantities she uses _________ transportation to ship the lumber from Washington? Select one: a. Rail b. Pipeline c. Air d. Water e. Truck

answer

question

Carlina operates an oil refinery in Houston Texas. She gets her crude oil from the largest oilfield in Texas. Because the product is more or less fluid and because she knows exactly where the raw material is coming from and where it has to go, Carlina uses _________ transportation for this part of her business? Select one: a. Truck b. Rail c. Water d. Air e. Pipeline

answer

question

Which of these would be considered an indirect marketing channel? Select one: a. A producer, a wholesaler, and a retailer b. A producer and a retailer c. A producer and a customer d. A customer, a retailer, and a producer e. A retailer and a customer

answer

question

A marketing channel helps to create ______ utility? Select one: a. Time b. Form c. Electric d. Place e. Image

answer

question

A marketing channel always includes? Select one: a. A wholesaler b. An intermediary c. An end user d. All of the above e. A raw materials supplier

answer

question

The _________________ channel flow involves two-way communication between producer and consumer? Select one: a. Risking b. Ordering c. Ownership d. Promotion e. Negotiation

answer

question

Kendra runs a wholesale distribution center for candy. Each week she receives a truckload of candy from her supplier and unpacks it so that her customers only have to buy a case at a time. Kendra is adding value by ___________? Select one: a. Creating assortment b. Storing c. Transporting d. Grading. e. Breaking bulk

answer

question

Carlina operates a tofu making factory in Taiwan. She uses soybeans grown in Northwest Ohio for her tofu because they are very high quality and the prices are low. Soybeans will keep for a very long time without spoiling. Because her main concern is how to get the thousands of bushels of soybeans to her factory for the least cost, Carlina uses _________ transportation for this part of her business? Select one: a. Air b. Rail c. Pipeline d. Truck e. Water

answer

question

One of the advantages of ____________ is that they can be moved from one platform to another without having been loaded or unloaded. Names such as piggyback, fishyback relate to the variety of transportation options? Select one: a. Conveyer belts b. Packages c. Shipping containers d. Trucks e. Forklifts

answer

question

Keeping inventory levels low decreases the chance of a stock out. Select one: True False

answer

false

question

____________ deals with the flow of physical goods and related information through the value chain? Select one: a. Channeling b. Logistics c. Marketing d. Efficiency e. Promotion

answer

question

answer

question

answer

question

A marketing channel helps to create ______ utility? Select one: a. Time b. Form c. Electric d. Place e. Image

answer

question

A marketing channel always includes? Select one: a. A wholesaler b. An intermediary c. An end user d. All of the above e. A raw materials supplier

answer

question

The _________________ channel flow involves two-way communication between producer and consumer? Select one: a. Risking b. Ordering c. Ownership d. Promotion e. Negotiation

answer

question

answer

question

answer

question

answer

question

Keeping inventory levels low decreases the chance of a stock out. Select one: True False

answer

false

question

____________ deals with the flow of physical goods and related information through the value chain? Select one: a. Channeling b. Logistics c. Marketing d. Efficiency e. Promotion

answer

question

answer

STUDY

Economic Order Quantity Finance Finished Goods Inventory Perpetual Inventory System

Chapter 12- Inventory Management – Flashcards 38 terms

Jill Lopez

38 terms

Preview

Chapter 12- Inventory Management – Flashcards

question

Objective of inventory management

answer

Strike a balance between inventory investment and customer service

question

Four functions of inventory

answer

1. To provide a selection of goods for anticipated customer demand and to separate the firm from fluctuations in that demand 2. Decouple various parts of the production process 3. Take advantage of quantity discounts 4. Hedge against inflation

question

Types of inventory

answer

Raw material inventory; work-in-process inventory; maintenance/repair/operating supply (MRO) inventory, and finished-goods inventory

question

Raw material inventory

answer

Materials that are usually purchased but have yet to enter the manufacturing process

question

Work-in-process (WIP) inventory

answer

Products or components that are no longer raw materials but have yet to become finished products

question

Maintenance/repair/operating (MRO) inventory

answer

Maintenance, repair, and operating materials

question

Finished-goods inventory

answer

end item ready to be sold, but still an asset on the company's books

question

ABC analysis

answer

Method for dividing on-hand inventory into three classifications based on annual dollar volume A = high dollar volume B = medium " " C = low " "

question

Cycle counting

answer

Continuing reconciliation of inventory with inventory records

question

advantages of cycle counting

answer

- eliminates shutdown and interruption of production necessary for annual physical inventories - eliminates annual inventory adjustments - trained personnel audit the accuracy of inventory - allows cause of errors to be identified and remedial action to be taken - maintains accurate inventory records

question

Shrinkage

answer

Retail inventory that is unaccounted for between receipt and sale

question

Pilferage

answer

Small amount of theft

question

Independent demand

answer

demand for item is independent of the demand for any other item in inventory

question

Holding costs

answer

Costs associated with holding or "carrying" inventory over time

question

Ordering cost

answer

Cost of ordering process; includes costs of supplies, forms, order processing, purchasing, clerical support, etc.

question

setup cost

answer

cost to prepare a machine or process for manufacturing an order

question

setup time

answer

time required to prepare a machine or process for production

question

Three independent demand models

answer

basic economic order quantity (EOQ) model; production order quantity model; quantity discount model

question

Economic order quantity (EOQ) model

answer

inventory-control technique that minimizes the total of ordering and holding costs

question

EOQ model assumptions

answer

- demand for an item is known, reasonably constant, and independent of decisions for other items - lead time is known and consistent - receipt of inventory is instantaneous and complete - quantity discounts are not possible - only variable costs are the cost of setting up or placing an order and the cost of holding or storing inventory over time - stockouts (shortages) can be completely avoided if orders are placed at the right time

question

Optimal order quantity

answer

Point where the ordering-cost curve and the carrying-cost curve intersect

question

Annual setup cost

answer

number of orders placed per year x setup or order cost per order ((D/Q)) (S)

question

Annual holding cost

answer

average inventory level x holding cost per unit per year ((Q/2)) (H)

question

expected number of orders

answer

N = (D / Q)

question

Expected time between orders

answer

T = (number of working days per year / N)

question

total annual cost

answer

Setup (order) cost + holding cost

question

Robust

answer

giving satisfactory answers even with substantial variation in the parameters; EOQ is a robust model

question

lead time

answer

In purchasing system, the time between placing an order and receiving it; in production system, the wait, move, queue, setup, and run times for each component produced

question

Reorder point (ROP)

answer

inventory level (point) at which action is taken to replenish the stocked item ROP = d x L

question

Safety stock (ss)

answer

Extra stock to allow for uneven demand; a buffer

question

Production order quantity model

answer

economic order quantity technique applied to production orders

question

probabilistic model

answer

Statistical model applicable when product demand or any other variable is not known but can be specified by means of a probability distribution annual stockout costs = (sum of the units short for each demand level) x (probability of that demand level) x (the stockout cost/unit) x (the number of orders per year)

question

demand is variable and lead time is constant

answer

ROP = (average daily demand x lead time in days) + Z(standard deviation of demand per day x standard deviation lead time in days)

question

demand is constant and lead time is variable

answer

ROP = (daily demand x average lead time in days) + Z x daily demand x standard deviation of lead time in days

question

both demand and lead time are variable

answer

ROP = (average daily demand x average lead time in days) + Z(standard deviation of demand per day x standard deviation lead time in days)

question

single-period inventory model

answer

System for ordering items that have little or no value at the end of a sales period (perishables) -underestimated: Cs = Sales price per unit - cost per unit - overestimated: Co = cost per unit - salvage value per unit

question

Service level

answer

Probability of not stocking out Cs / (Cs + Co)

question

Fixed-period (P) system

answer

System in which inventory orders are made at regular time intervals

STUDY

Accounting Economic Order Quantity Intermediate Accounting 2 Inventory Control System Petty Cash Fund

Acct Ch 13 Answers – Flashcards 83 terms

Steven Colyer

83 terms

Preview

Acct Ch 13 Answers – Flashcards

question

A) vendor-managed inventory.

answer

1) The Squishy Things Toy Company was established in 1948. It recently signed a large contract with a chain of retail toy stores. As a condition of the contract, the Squishy will be required to track and forecast product sales by linking in to the chain's sales database. Squishy will then be responsible for shipping products to the chain's regional warehouses as needed. The relationship between Squishy and the chain is an example of

question

A) A supplier delivers more inventory than ordered at the end of the year and sends an invoice for the total quantity delivered.

answer

2) Requiring all packing slips be reconciled to purchase orders before accepting a delivery of inventory would be most likely to prevent which of the following situations?

question

A) Receiving and accepting inventory not ordered

answer

3) Comparing quantities on a vendor invoice to quantities on the receiving report would not prevent or detect which of the following situations?

question

A) Only pay from original invoices.

answer

4) Which of the following would probably be the least effective control to mitigate the risk of paying an invoice payable to a phony vendor for inventory purchases, mailed to the company by an employee attempting to commit fraud?

question

A) Allow only the accounts payable department to authorize payment for vendor invoices and allow only the cash disbursements department to cut and mail checks to vendors.

answer

5) Which of the following would be the least effective control to prevent paying the same vendor invoice twice? =

question

D) What are the optimal prices for each product or service?

answer

6) To accomplish the objectives set forth in the expenditure cycle, a number of key management decisions must be addressed. Which of the decisions below is not ordinarily found as part of the expenditure cycle?

question

B) shipping function

answer

7) One of the basic activities in the expenditure cycle is the receiving and storage of goods, supplies, and services. What is the counterpart of this activity in the revenue cycle?

question

C) economic order quantity.

answer

8) The traditional approach to inventory management to ensure sufficient quantity on hand to maintain production is known as

question

B) carrying costs.

answer

9) Economic Order Quantity (EOQ) includes several variables that must be taken into consideration when calculating the optimal order size. One variable, the costs associated with holding inventory, is referred to as 9) Economic Order Quantity (EOQ) includes several variables that must be taken into consideration when calculating the optimal order size. One variable, the costs associated with holding inventory, is referred to as

question

D) reorder point.

answer

10) The need to place an order for inventory is specified by the

question

D) inventory, vendors, and open purchase orders

answer

11) When goods are being ordered from a vendor, which electronic files are either read or updated?

question

B) reduce required inventory levels by scheduling production rather than estimating needs

answer

12) What is a key feature of materials requirements planning (MRP)?

question

A) reduces the uncertainty about when materials are needed, thereby reducing the need to carry large levels of inventory.

answer

13) Materials requirements planning (MRP)

question

C) just-in-time inventory.

answer

14) The inventory management approach that attempts to minimize, if not eliminate, carrying and stockout costs is

question

A) frequent deliveries of smaller quantities of items to the work centers

answer

15) What aspect below best characterizes a Just-In-Time (JIT) inventory system?

question

D) MRP schedules production to meet estimated sales needs; JIT schedules production to meet customer demands.

answer

16) What is the key difference between the MRP and JIT inventory management approaches?

question

A) demand for inventory is fairly predictable.

answer

17) MRP will be a preferred method over JIT when the

question

C) credit rating of the vendor

answer

18) A key decision in ordering is selecting a suitable vendor. Which of the following would not be a major criterion in vendor selection?

question

D) inventory master file.

answer

19) Once a vendor is selected for a product, the vendor's identity is recorded in the

question

D) All of the above are true.

answer

20) A purchase order is

question

A) blanket purchase order.

answer

21) Stepanek Sales and Service provides free coffee to employees. Stepanek arranged with Ingebrigtson's Joe to deliver as many coffee packages, sugar, creamer, and filters as needed each week. Ingebrigtson's sends a monthly invoice for Stepanek to pay. This arrangement is best described as a

question

C) a reverse auction.

answer

22) A major cost in the purchasing function is the number of purchase orders processed. One technique that may reduce purchasing-related expenses is to have suppliers compete with each other to meet demand at the lowest price. This name of this technique is

question

A) deciding if the delivery should be accepted.

answer

23) One of the major responsibilities of the receiving department is

question

A) price of the items

answer

24) Which of the following is generally not shown on a receiving report?

question

D) the purchasing department manager

answer

25) A receiving clerk notes that a delivery of 10 units has been received, but the purchase order specified 12 units. A debit memo will need to be prepared to adjust for the difference between the quantity ordered and received. Who should prepare this document?

question

D) All of the above are possible scenarios.

answer

26) Identify in which of the following scenarios a company could adjust the balance due the vendor by issuing a debit memo.

question

B) requiring all suppliers to include RFID tags on their items

answer

27) What is one of the best ways to improve the overall efficiency and effectiveness of the receipt and storage of ordered items?

question

D) accounts payable department; controller

answer

28) Vendor invoices are approved by the ________, which reports to the ________.

question

A) cashier

answer

29) The disbursement voucher and supporting documents are sent to the ________ for payment prior to the due date.

question

A) nonvoucher

answer

30) A(n) ________ system posts an approved invoice to the vendor account and stores it in an open invoice file until payment is made by check.

question

D) All of the above are correct.

answer

31) A disbursement voucher contains

question

D) a disbursement voucher system.

answer

32) One objective of accounts payable is to authorize payment only for goods or services actually ordered and received. The best way to process supplier invoices is to use

question

D) There are no disadvantages to using disbursement vouchers.

answer

33) What is not an advantage of using disbursement vouchers?

question

D) It is a less expensive and easier system to administer than other systems.

answer

34) Which of the following is not an advantage of a voucher system?

question

B) purchasing; accounts payable; cashier

answer

35) Duties in the expenditure cycle should be properly segregated to promote internal control. This means that the authorization function is performed by ________, the recording function is performed by ________, and cash handling is performed by the ________.

question

B) a purchase order, vendor invoice, and receiving report.

answer

36) A voucher package should include

question

C) receiving report.

answer

37) Evaluated receipt settlement (ERS) approves payment of vendor invoices after reconciling the purchase order and the

question

A) use blanket purchase orders.

answer

38) All of the following are opportunities to improve efficiency of the accounts payable function except

question

A) using procurement cards.

answer

39) When purchasing miscellaneous supplies, companies can reduce costs, improve efficiency, and combat employee fraud by

question

C) 18

answer

40) If available, a 1% discount for payment within 10 days instead of 30 days represents an approximate savings of ________ % annually.

question

B) use only approved suppliers and solicit competitive bids

answer

41) What is the best control to mitigate the threat of paying prices that are too high for goods ordered?

question

C) a corporate policy to prohibit purchasing agents from accepting kickbacks

answer

42) What is probably the most effective control for the prevention of kickbacks to purchasing agents?

question

A) errors in counting.

answer

43) One of the threats associated with the process and activity of receiving and storing goods is

question

B) Match the packing slip to a purchase order before accepting delivery.

answer

44) What is the best way to prevent the acceptance of unordered goods?

question

C) sending "blind" copies of purchase orders to inventory control for data entry

answer

45) Which of the following is not a common control for ensuring inventory is secure and inventory counts are accurate?

question

C) paying for goods and services

answer

46) Double-checking the accuracy of an invoice is a control that can help to neutralize a threat in the expenditure cycle. What activity would specifically be associated with this control?

question

A) never authorize payment of a photocopy of an invoice

answer

47) What control would best mitigate the threat of paying an invoice twice?

question

A) Allow payments only to approved vendors.

answer

48) Which control would best prevent payments made to fictitious vendors?

question

B) imprest fund; vouchers

answer

49) In the expenditure cycle, good control dictates that expenditures should be paid by check. This may not be feasible when minor purchases are made. To facilitate quick payment for minor purchases, a(n) ________ should be set up and maintained using ________.

question

B) cash and vouchers

answer

50) A surprise count of an imprest petty cash fund should find the total of ________ equal to the amount authorized for the fund.

question

C) Establish a control group to monitor EFT transactions for validity and accuracy.

answer

51) What control should be put in place that assigns responsibility for EFT payments made to vendors?

question

B) purchasing from unauthorized vendors

answer

52) Which of the following threats is not specific to the purchase requisition process of the expenditure cycle?

question

B) revenue cycle.

answer

53) There is a symmetrical interdependence between a firm's expenditure cycle and its suppliers'

question

C) electronic data interchange.

answer

54) The Squishy Things Toy Company was established in 1948. It recently signed a large contract with a chain of retail toy stores. As a condition of the contract, the Squishy will be required to track and forecast product sales by linking in to the chain's sales database. Squishy will then be responsible for shipping products to the chain's regional warehouses as needed. The technology that is used for communication between Squishy and the chain is

question

B) the economic order quantity.

answer

55) The management at Sad Clown Pajamas, an Internet-based wholesaler, is considering a new inventory control system. The current system is inadequate because it results in stockouts that interrupt production and excess stocks of some materials that result in markdowns and high carrying costs. The new system, which will focus on ensuring that the amounts purchased minimize these costs, will employ

question

C) a reorder point.

answer

56) The management at Sad Clown Pajamas, an Internet-based wholesaler, is considering a new inventory control system. The current system is inadequate because it results in stockouts that interrupt production and excess stocks of some materials that result in markdowns and high carrying costs. The new system, which will focus on ensuring that orders are placed with sufficient lead time to prevent stockouts, will employ

question

D) materials requirements planning.

answer

57) The management at Sad Clown Pajamas, an Internet-based wholesaler, is considering a new inventory control system. The current system is inadequate because it results in stockouts that interrupt production and excess stocks of some materials that result in markdowns and high carrying costs. The new system, which will focus on forecasting demand for Sad Clown's products, will employ

question

A) a just-in-time inventory system.

answer

58) The management at Sad Clown Pajamas, an Internet-based wholesaler, is considering a new inventory control system. The current system is inadequate because it results in stockouts that interrupt production and excess stocks of some materials that result in markdowns and high carrying costs. The new system, which will focus on reducing or completely eliminating carrying costs, will employ

question

B) blanket purchase order

answer

59) Bob Chum is the sales manager at Folding Squid Technologies. At lunch with the company CEO, he proudly announced that he had negotiated a(n) ________ with a client that defined a long-term commitment to buy components from Folding Squid.

question

A) purchase order

answer

60) Bob Chum is the sales manager at Folding Squid Technologies. At lunch with the company CEO, he proudly announced that he had received a ________ from a client to buy a large quantity of components from Folding Squid.

question

D) debit memo

answer

61) Bob Chum is the sales manager at Folding Squid Technologies. At lunch with the company CEO, he complained that a recent shipment from a vendor had been unsatisfactory and so had to be returned. That required the purchasing manager to send a ________ to the supplier.

question

A) voucher system.

answer

62) To minimize the number of checks that need to be written to pay vendor invoices a company should use a

question

B) eliminating the need for vendor invoices.

answer

63) Evaluated receipt settlement increases efficiency by

question

D) eliminating the need to prepare and mail checks.

answer

64) In the expenditure cycle, Financial Electronic Data Interchange (FEDI) increases efficiency by

question

C) Procurement cards can only be used with approved vendors, but credit cards can be used anywhere.

answer

65) Procurement cards differ from corporate credit cards in which of the following ways?

question

B) Accounts payable should reconcile purchase orders, receiving reports, and invoices.

answer

66) The purchasing manager at Folding Squid Technologies has responsibility for reviewing and authorizing purchase orders. He also reviews receiving reports, approves or corrects them, and authorizes the cashier to pay vendor invoices. Which of the following would correct control weaknesses, if any, related to these activities?

question

D) Controls are adequate under the current system.

answer

67) The purchasing manager at Folding Squid Technologies has responsibility for reviewing and authorizing purchase orders. Receiving reports are prepared by shipping and receiving based on the relevant purchase order(s). Purchase orders, receiving reports, and vendor invoices are reconciled by accounts payable, which authorizes payment. Which of the following would correct control weaknesses, if any, related to these activities?

question

B) Accounts payable should reconcile the purchase order and the receiving report.

answer

68) The receiving clerk at Folding Squid Technologies examines incoming shipments and reconciles their contents with the relevant purchase orders. A receiving report is then sent to accounts receivable and the vendor's invoice is approved for payment. Which of the following would correct control weaknesses, if any, related to these activities?

question

D) Controls are adequate under the current system.

answer

69) The receiving clerk at Folding Squid Technologies examines incoming shipments and checks their purchase order numbers. A receiving report is then sent to accounts payable, where it is reconciled with the relevant purchase orders and invoices and payment is authorized. Which of the following would correct control weaknesses, if any, related to these activities?

question

A) Variance analysis of actual expenses to budgeted expenses

answer

70) Which of the controls below would be least effective to prevent ordering goods at higher than market prices?

question

A) Receiving report

answer

71) The document below would be known as what by Alpha Omega Electronics? Alpha Omega Electronics No.31113 Vendor: Best Office Supply Date Received: 7/13/2009 Shipped via:UPS Purchase Order Number: 2463 Item Number Quantity Descr. 32057 15 Xerox 4200 Paper, 20 wt., 10 ream box 80170 5 Moore 2600 continuous, form, 20 lb 81756 20 Box CD cases, 10 per box 10407 100 700 MB CDs, 1 box of 100 Remarks: Two boxes of Moore 2600 paper received with water damage on outside, but the paper appears to be okay Received by: Nathan Hale Inspected by: Nathan Hale Delivered to: Harold Brown

question

A) Reconcile quantity on packing slip to physical count when accepting delivery.

answer

72) Which of the following would be the best control to prevent receiving department employees from stealing inventory and claiming the ordered quantity wasn't received from the vendor?

question

Answer: EOQ (economic order quantity) is the traditional inventory control method to maintain sufficient inventory levels so production can continue without interruption. EOQ should take into account a situation where inventory use is greater than expected. EOQ calculates the optimal order size to minimize the sum of ordering, carrying, and stockout costs. Ordering costs all expenses associated with processing purchasing transactions. Carrying costs costs associated with holding inventory. Stockout costs costs from inventory shortages, such as lost sales or production costs.

answer

73) Define and describe the EOQ approach to inventory management.

question

Answer: Economic Order Quantity (EOQ) is the traditional approach to managing inventory. EOQ is used to find the optimal order size. Ordering costs, carrying costs, and stockout costs are considered in finding the EOQ. The MRP (Materials Requirements Planning) inventory method seeks to reduce inventory levels by scheduling production, based on estimated sales, rather than by estimating needs (which EOQ does). A just-in-time inventory system (or JIT) attempts to minimize, if not totally eliminate, both carrying and stockout costs through the frequent delivery of small amounts of materials, parts, and supplies when they are needed. JIT does not attempt to estimate needs or schedule production based on estimated sales, as it is based on customer demand at a given time. A JIT system almost eliminates finished goods inventory.

answer

74) Discuss the differences between EOQ, MRP, and JIT

question

Answer: a) The major cost driver in the purchasing function is the number of purchase orders processed. b) The number of purchase orders can be reduced or streamlined by: Electronic data interchange (EDI) for transmitting purchase orders to vendors. Use procurement cards for small dollar and small quantity purchases of non-inventory items. Reduce clerical costs by using the Internet to perform certain purchasing functions. Use vendor-managed inventory programs to reduce purchasing and inventory costs. Implement reverse auctions and pre-award audits.

answer

75) a) What is the major cost driver in the purchasing function? b) Describe how information technology can be used to control this cost driver.

question

Answer: The expenditure cycle has been called a "mirror image" of the revenue cycle because the activities of the expenditure cycle are the opposite, or "reflection" of several activities found in the revenue cycle. For example, the order goods activity generates a purchase order, which serves as customer input to the sales order entry process. The receive goods activity handles the goods sent via the supplier's shipping function. The pay for goods activity generates the payments that are processed by the supplier's cash collection activity. This mirror image also means that major technological improvements in the expenditure cycle may bring about complementary improvements in suppliers' revenue cycle as well.

answer

76) Explain what is meant by the expenditure cycle as a "mirror image" of the revenue cycle.

question

Answer: When a shipment of goods arrives, the quantity of goods received may not be the same as the quantity ordered; the goods may have been damaged in shipment and therefore are not suitable for use; and, goods may be received that are inferior in quality and fail an inspection. Whenever any of these problems occur, the purchasing department should deal with the vendor and issue a debit memo to record an adjustment to the order. The vendor should then issue a credit memo in acknowledgment of the problem and the pending adjustment.

answer

77) Identify possible problems associated with receiving goods and appropriate actions in response to the problems.

question

Answer: EDI eliminates the need to enter invoice data and the matching of payment documents all of this can be done using computers and network technologies. Technology can eliminate the need for vendor invoices by approving payment upon receipt of the goods. Imaging systems can eliminate paper flow, and universal languages such as XML can provide a paperless means of receiving and storing vendor invoices. Use of procurement cards, credit cards, and electronic expense forms can improve the efficiency of non-inventory purchases. ERS, which is invoiceless, is a means to replace the traditional three-matching process (vendor invoice, receiving report and purchase order) with a two-way match of the purchase order and receiving report.

answer

78) How can information technology be used to improve the vendor invoice approval process?

question

Answer: MRP systems schedule production based on estimated sales, and JIT systems schedule production based on customer demand. The choice between these two systems is based on the types of products a company sells. For example, products that have predictable patterns of demand and a long life cycle are more suitable for MRP systems. In this case, sales can be forecast with greater accuracy. Conversely, if the product has an unpredictable pattern of demand and a shorter life cycle, then a JIT system is more suitable. JIT is able to adapt better to continuously changing production levels.

answer

79) Under what conditions is MRP more suitable than JIT and vice versa?

question

Answer: Key control problems in the area of payment by check can give rise to fraudulent activity. Fraudulent disbursements made by check to fictitious suppliers are one of the most common types of fraud. Control over checks can be strengthened in a number of ways. First, all checks should be sequentially pre-numbered and kept under lock and key until use. The internal auditor should randomly audit the supply of unused checks and verify that none are missing. Use of the voucher system will also provide control over paying a "phantom" supplier, since several supporting documents must be present in the voucher packet in order to have a check issued. The cashier and/or treasurer should be the only parties authorized to sign checks. Two signatures should be required on all checks in excess of a predetermined dollar amount to provide independent review of large expenditures. Also, signed checks should not be returned to accounts payable, but should be mailed by the cashier or treasurer. When a check is issued, all documents in the voucher package should be cancelled so that the voucher cannot be resubmitted for payment. To provide another independent review of checking account activity, someone not connected with either accounts payable or the treasurer's office should reconcile all bank accounts. To help circumvent check alteration and forgery, check protection machines should be used to write the dollar amount of the check as well as the date. The paper the check is printed on should have some special watermark or identifying mark that is readable at a certain angle as well.

answer

80) In the expenditure cycle, the majority of payments made are by check. What are some control issues related to payment of vendors by check?

question

Answer: Answers can include the following information: 1: Stock-outs Controls: Inventory control system; accurate perpetual inventory; and vendor performance analysis is needed to prevent this problem 2: Requesting goods not needed Controls: Review and approval by supervisors; use of pre-numbered requisition forms; and restricted access to blank purchase orders 3: Purchasing goods at inflated prices Controls: Competitive bidding and proper supervision; approved purchase orders; and price list consultations are needed to prevent this problem 4: Purchasing goods of inferior quality Controls: Use experienced buyers who know good vendors; review purchase orders; and incorporate approved vendor list into formal procedures 5: Purchasing from unauthorized vendors Control: Pre-numbered purchase orders should be approved; restrict access to approved vendor list and have procedures in place for any change to the list 6: Kickbacks paid to buyers to influence their decisions Controls: Clear conflict of interest policy prohibiting the acceptance of any gift from vendors; disclosure of financial interest policy for purchasing agents; and vendor audits 7: Receiving unordered goods Controls: Receiving department must reject any goods for which there is no approved purchase order 8: Errors in counting goods received Controls: Use "blind" P.O. copies to force receiving personnel to actually count goods; provide incentives for counting goods 9: Theft of inventory Controls: Secure inventory storage locations; make transfers of inventory with proper approval and documentation; do periodic physical count and reconciliation with recorded amounts 10: Errors in vendor invoices Controls: Invoice accuracy should be verified and compared to P.O.s and receiving report data 11: Paying for goods not received Controls: Voucher package and original invoice should be necessary for payments 12: Failure to take available purchase discounts Controls: File approved invoices by due date; track invoices by due date; use a cash budget to plan for cash needs 13: Paying same invoice twice Controls: Invoices should be approved only with a full voucher package and paid ones should be canceled so they cannot be used again; do not pay invoices marked "Duplicate" or "Copy" 14: Recording and posting errors for purchases and payments Controls: Data entry controls, and periodic reconciliation of subsidiary ledger with general ledger control account 15: Misappropriation of cash by paying fictitious vendors and alteration of checks Controls: Restrict access to cash, blank checks, and check signing machine; use check protection, pre-numbered checks, and imprinted amounts on checks to cut down on forgery and fraud; use petty cash fund for small expenditures only; have proper segregation of duties and independent bank reconciliation function 16: Theft associated with EFT use Controls: Access controls to the system; encryption of transmissions; time-stamp and number transmissions; control group should monitor all EFT activity 17: Loss of data Controls: Use file labels, back up of all data files regularly; and, use access controls 18: Poor performance Controls: Preparation and review of performance reports

answer

81) Identify ten threats and applicable control procedures in the expenditure cycle.

question

Answer: The AIS should provide decision making information to: Determine when and how much additional inventory to order. Select the appropriate vendors from whom to order. Verify the accuracy of vendor invoices. Decide whether purchase discounts should be taken. Monitor cash flow needs to pay outstanding obligations. AIS should also provide the following strategic and performance evaluation information on: Efficiency and effectiveness of the purchasing department. Analysis of vendor performance such as on-time delivery, quality, etc. Time taken to move goods from the receiving dock into production. Percentage of purchase discounts taken.

answer

82) What types of decision-making and strategic information should the AIS provide in the expenditure cycle?

question

Answer: RFID tags and bar codes can significantly improve the process of receiving goods from suppliers for several reasons. First, they can easily be scanned electronically. Electronically capturing the unique number of a product not only provides identification and quantity data about the product; it can also provide specific production information such as date and time of manufacture, production run information, etc. Electronically encoding such information into an integrated AIS provides up-to-the-minute inventory counts, as well as counts of units sold, and returns for use in a perpetual inventory system. Also, both vendor and customers can read tags and bar codes, and certain formats are universal in nature. This allows goods to be sold virtually anywhere in the world, allowing for easier global marketing efforts to be made by businesses. It also eliminates the need for human data entry and reduces the risk of stockouts.

answer

83) How can using RFID tags or bar codes on goods or products provide significant benefit in the expenditure cycle?

STUDY

Accounting Date Economic Order Quantity Finance Real Time Processing

BP chapter 5 – Flashcards 27 terms

Sonia Kelly

27 terms

Preview

BP chapter 5 – Flashcards

question

in a non-manufacturing firm, purchasing decisions are authorized by

answer

inventory control

question

firms that wish to improve control over CD use a ___ system

answer

voucher

question

Proper segregation of duties requires that the responsibility approving a payment be separated from posting to the __

answer

CD journal

question

one reason for authorizing purchases is to enable efficient ___

answer

inventory management

question

when goods are received, the receiving clerk send copies of the receiving report to the ___ clerk and the ___ clerk

answer

inventory control, AP

question

purpose of the ___ is to authorize the purchasing department to order goods

answer

purchase requisition

question

purpose of the ___ is to record the receipt of goods from vendors

answer

receiving report

question

purchasing, receiving, and AP departments all have a copy of the

answer

question

purpose of the ___ is to order goods from vendors

answer

question

the ___ indicates item description, quantity, and price

answer

question

the ___ is used to accompany physical inventories to the storeroom or warehouse

answer

receiving report

question

when a copy of the receiving report arrives in the ___, it is used to recognized that a PO has closed

answer

purchasing department

question

financial value of a purchase is determined by reviewing the supplier's

answer

invoice

question

in a merchandising firm, authorization for the PAYMENT of inventory is the responsibility of

answer

question

in a merchandising firm, authorization for the PURCHASE of inventory is the responsibility of

answer

inventory control

question

usually triggers the recording of a liability

answer

invoice

question

GL posts the ___ from the AP department

answer

journal voucher

question

GL posts the ___ from the inventory control

answer

account summary

question

GL reconciles the ___ with the inventory subsidiary summary

answer

inventory control

question

the documents in a ___ packet include a PO, RR, and invoice

answer

voucher

question

the ___ clerk prepares checks, marks supporting docs paid, and reviews supporting docs for completeness

answer

question

___ shows that the transaction was authorized

answer

purchase requisition

question

this document will close the open purchase requisition file

answer

receiving report

question

if a co uses a standard cost system, inventory records can be updated from the ___

answer

receiving report

question

if a co uses an actual cost system, the inventory records can be updated from the ___

answer

invoice

question

copies of the ___ are sent to the inventory control, receiving, and AP

answer

question

the cash disbursement function is a ___ function

answer

treasury

STUDY

Demand Economic Order Quantity Finance Financial Management Fixed Order Quantity Human Resource Management Planning And Controlling

Chapter 4- Inventory Management – Flashcards 62 terms

Anthony Richie

62 terms

Preview

Chapter 4- Inventory Management – Flashcards

question

inventory

answer

the quantities of goods and materials that are held in stock

question

4 categories of inventory

answer

raw materials work-in-progress (WIP) finished goods maintenance, repair, and operating (MRO) supplies

question

raw materials

answer

purchased items or extracted materials that are converted via the manufacturing process into components and products

question

work-in-process

answer

a good or goods in various stages of completion throughout the plant, spanning from raw material that has been released for initial processing up to fully processed material awaiting final inspection and acceptance as finished goods

question

finished goods

answer

items on which all manufacturing operations, including final testing, have been completed. These items are available for sale and/or shipment to the customer

question

MRO

answer

(maintenance, repair, and operating) items used in support of general operations and maintenance such as maintenance supplies, spare parts, and consumables used in the manufacturing process and supporting operations

question

service inventory

answer

activities carried out in advance of the customer's arrival

question

Why hold inventory?

answer

1. to meet customer demand (cycle stock) 2. to buffer against uncertainty in demand and/or supply (safety stock) 3. to decouple supply from demand (strategic stock) 4. to decouple dependencies in the supply chain

question

Inventory Management

answer

The function of planning and controlling inventories Goal is to help a company be more profitable by lowering COGs and/or by increasing sales

question

What is the right amount of inventory?

answer

It depends on the supply chain strategy and set up, the types of products, etc

question

3 Levels of Internal Inventory

answer

1. Cycle Stock 2. Safety Stock 3. Strategic Stock

question

cycle stock

answer

inventory that a company builds to satisfy its immediate demand; gradually depletes as customer orders are received

question

safety stock

answer

inventory that is above and beyond what is actually needed to meet anticipated demand

question

strategic stock

answer

additional inventory beyond cycle and safety stock, generally used for a very specific purpose or future event, and for a defined period of time

question

pipeline inventory

answer

inventory that is already out in the market held by wholesalers, distributors, retailers, and even consumers; also in-transit

question

obsolete inventory

answer

inventory that is expired, damaged, or no longer needed; will never be used or sold at full value

question

inventory costs

answer

- direct costs - indirect costs - fixed costs - variable costs - order costs - carrying costs

question

direct costs

answer

directly traceable to unit produced

question

indirect costs

answer

cannot be traced directly to the unit produced

question

fixed costs

answer

independent of hte unit volume produced

question

variable costs

answer

dependent on the unit volume

question

order costs

answer

labor costs associated with placing an order for inventory and the cost of receiving the order; incurred each time an order is placed

question

carrying costs

answer

costs for physically having inventory on-site and for maintaining the infrastructure needed to store the inventory and to secure and insure it over time; incurred for holding inventory

question

effects of having too much inventory

answer

financial resources tied up in inventory underlying problems being hidden rather than being exposed and solved no incentive for process improvements

question

effects of having too little inventory

answer

production disruptions longer delivery replenishment lead times reduced responsiveness

question

measures of inventory investment

answer

Absolute inventory Value Inventory Turnover

question

Absolute Inventory Value

answer

the value of the inventory at either its cost or its market value

question

inventory turnover

answer

the # of times that an inventory cycles or "turns over", during the year *the more the better ratio = COGS/Average Inventory @ Cost

question

Inventory policy

answer

establishing target inventory levels for all products and materials 1. When to review? 2. When to order? 3. How much to order?

question

2 Models for Determining When to Review

answer

1. Continuous Review System 2. Periodic Review System

question

continuous reiew system

answer

inventory levels are continuously reviewed; as soon as inventory falls below a pre-determined level, a replenishment order is triggered

question

periodic review system

answer

inventory levels are reviewed at a set frequency; at the time of review, if the stock levels are below the pre-determined level, an order for replenishment is placed, other wise no action is taken until the next cycle

question

Reorder Point

answer

(ROP) the lowest inventory level at which a new order must be placed to avoid a stockout - set at a level that provides enough inventory so demand is covered during the lead time (L) needed to replenish inventory

question

Common Inventory Ordering System Categories

answer

Fixed-Order Quantity System Fixed-Time Period System

question

Fixed-Order Quantity System

answer

a continuous inventory review system in which the same order quantity is used from order to order - when inventory position drops to a predetermined reorder point, a predetermined fixed order quantity is placed

question

Fixed-Time Period System

answer

inventory is checked in fixed time periods against a target inventory level - if inventory is less than target, a quantity necessary to bring inventory back up to the target level is ordered Q = R - IP where Q = order quantity, R = target inventory level, and IP = inventory position

question

EOQ

answer

(Economic Order Quantity) a quantitative decision model based on the trade-off b/t annual inventory carrying costs and annual order costs sq[(2*D*S)/H)] Where D = annual demand, Q = order quantity (units), and S = ordering costs (per order)

question

Total Cost

answer

Purchase Cost + Order Cost + Carrying Cost

question

Annual carrying costs

answer

(Q/2)*H Where Q = order quantity and H = holding costs (per unit)

question

annual ordering costs

answer

(D/Q)*S Where D = annual demand, Q = order quantity (units), and S = ordering costs (per order)

question

Practical Considerations of EOQ

answer

Volume Economies of Scale Constraints

question

Volume Economies of Scale

answer

Individual Item Purchase Price Discounts Multiple-Item Purchase Price Discounts Transportation Freight-Rate Discounts

question

Individual Item Purchase Price Discounts

answer

discounts for ordering purchase price discounts; if volume discount is sufficient to offset the added cost from carrying additional inventory, then order a larger volume may be desirable

question

Multiple-Item Purchase Price Discounts

answer

based on total volume across all the items purchased rather than just an individual item's volume

question

Transportation Freight-Rate Discounts

answer

ordering a larger quantity may mean that you can take advantage of Transportation Freight Rate Discounts which will lower per unit costs

question

Constraints

answer

Limited Capital storage capacity transportation obsolescence production lot size unitization

question

Limited Capital

answer

company doesn't have sufficient available funds to purchase at one time

question

storage capacity

answer

company doesn't have sufficient storage capacity to handle at one time

question

transportation

answer

item being ordered and transported may require specialized or dedicated transportation, impacting the quantity per order

question

production lot size

answer

supplier may require the company to order an item in full production lot sizes

question

unitization

answer

supplier may require company to order an item in full pack, case, or pallet configurations

question

Other Types of inventory Systems

answer

- ABC System - Bin System - Base Stock Level System - "Single-Period" Inventory Model

question

ABC system

answer

classifies inventory based on the degree of importance A: Highest Value B: Moderate Value C: Least Valuable

question

Bin System

answer

inventory system that uses either one or two bins to hold quantity of the item being inventoried; mainly used for small or low value items

question

Base Stock Level System

answer

a type of inventory system that issues an order whenever a withdrawal is made from inventory

question

single-period model

answer

a type of inventory system is only ordered for one-time stocking - goal is to maximize profits Ex) Newspaper stands

question

barcode systems

answer

help businesses track products and stock levels for inventory management Types: Linear 1D, 2D, barcode reader

question

common metrics for inventory

answer

units, dollars, weeks of supply, inventory turns

question

units

answer

the # of units available

question

dollars

answer

the amount of dollars tied up in inventory

question

weeks of supply

answer

(avg. on-hand inventory)/(avg weekly usage)

question

inventory turns

answer

(COGS)/(avg. inventory value)

STUDY

Business Management Classroom Economic Order Quantity Operations Management Probability Processes

Operations Management Final Exam Practice Problems – Flashcards 450 terms

Kevin Stewart

450 terms

Preview

Operations Management Final Exam Practice Problems – Flashcards

question

when the bottlenecks need work

answer

Work should be released into the system:

question

setup time

answer

The time required to change a machine from making one product or service to the next is called:

question

A TOC analyst would not be concerned with setup times on non-bottleneck machines

answer

Which of the following statements regarding setups is TRUE?

question

Utilization and activation of a resource are not the same

answer

Which of the following is one of Dr. Eli Goldratt's rules of production scheduling for optimized production technology?

question

Do not balance capacity, balance the flow

answer

Which of the following is one of Dr. Eli Goldratt's rules of production scheduling for optimized production technology?

question

Identify system constraints

answer

Which of the following is a "focusing step" of Dr. Eli Goldratt's theory of constraints?

question

Net profit

answer

According to the theory of constraints which of the following is a financial measurement that can be used to measure the firm's ability to make money?

question

An employee

answer

According to the theory of constraints which of the following can be a CCR?

question

Keep a buffer inventory in front of it to insure that it always has something to work on

answer

Which of the following is an approach to dealing with a bottleneck?

question

Bottleneck or CCR

answer

What is a word indicating a resource whose capacity is less than the demand placed on it?

question

Throughput

answer

What is the rate at which money is generated by the system through sales called?

question

Cash flow

answer

According to the theory of constraints, which of the following is a financial measure that can be used to measure the firm's ability to make money?

question

Throughput

answer

According to the theory of constraints, which of the following is an operational measurement that can be used to measure the firm's ability to make money?

question

Inventory

answer

According to the theory of constraints, which of the following is an operational measurement that can be used to measure the firm's ability to make money?

question

An employee

answer

According to the theory of constraints, which of the following can be a CCR?

question

Idle time

answer

According to the theory of constraints, which of the following is a kind of time that makes up the cycle time in production?

question

Process time

answer

According to the theory of constraints, which of the following is a kind of time that makes up the cycle time in production?

question

File

answer

Which of the following is not an important concept in TOC?

question

Research and development

answer

A useful measure of inventory performance is called "dollar days." In which of the following areas are dollar days measurements not useful?

question

JIT does not allow very much flexibility in the products produced

answer

Which of the following is a negative aspect of JIT compared to synchronous manufacturing?

question

All managers should understand the basic principles that guide the design of transformation processes

answer

A reason for studying operations management (OSM) is which of the following?

question

Pure goods, core goods, core services, pure services

answer

The Goods-Services Continuum consists of which set of the following categories?

question

Data storage systems

answer

Which of the following are defined as core goods?

question

Increasing global servitization networks

answer

Current issues in OSM do not include:

question

Hospital administrator

answer

Which of the following are not listed in the text as jobs in OSM?

question

Service jobs are unskilled

answer

Which of the following is not a characteristic that distinguishes services from goods?

question

Selecting

answer

Which of the following is not a way that operations and supply processes are categorized?

question

Facilitating goods

answer

One of the package of features that make up a service are:

question

Sustainability

answer

The ability to maintain balance in a system is referred to as:

question

Operations

answer

Processes that are used to transform the resources into products are called:

question

Efficiency

answer

Doing something at the lowest possible cost is called:

question

Quality; price paid

answer

Value is the ratio of ____ to ____

question

Supply network

answer

A pipeline through which material and information flows is a conception of a:

question

Variance

answer

In time series data depicting demand which of the following is not considered a component of demand variation?

question

Force field analysis

answer

Which of the following is not one of the basic types of forecasting?

question

Past demand

answer

In most cases, demand for products or services can be broken into several components. Which of the following is not considered a component of demand?

question

Cyclical elements

answer

In most cases, demand for products or services can be broken into several components. Which of the following is considered a component of demand?

question

Autocorrelation

answer

In most cases, demand for products or services can be broken into several components. Which of the following is considered a component of demand?

question

Market research

answer

Which of the following forecasting methodologies is considered a qualitative forecasting technique?

question

Simple moving average

answer

Which of the following forecasting methodologies is considered a time series forecasting technique?

question

Weighted moving average

answer

Which of the following forecasting methodologies is considered a time series forecasting technique?

question

Liner regression

answer

Which of the following forecasting methodologies is considered a causal forecasting technique?

question

Panel consensus

answer

Which of the following forecasting methods uses executive judgement as its primary component for forecasting?

question

Delphi method

answer

Which of the following forecasting methods is very dependent on selection of the right individuals who will judgmentally be used to actually generate the forecast?

question

Less than three months

answer

In business forecasting, what is usually considered a short-term time period?

question

Three months to two years

answer

In business forecasting, what is usually considered a medium-term time period?

question

Two years or longer

answer

In business forecasting, what is usually considered a long-term time period?

question

Short-term forecasts

answer

In general, which forecasting time frame compensates most effectively for random variation and short term changes?

question

Medium term forecasts

answer

In general, which forecasting time frame best identifies seasonal effects?

question

Long range forecasts

answer

In general, which forecasting time frame is best to detect general trends?

question

Simple exponential smoothing

answer

Which of the following forecasting methods can be used for short-term forecasting?

question

Product

answer

Which of the following considerations is not usually a factor in deciding which forecasting model a firm should choose?

question

142.5

answer

A company wants to forecast demand using the simple moving average. If the company uses four prior yearly sales values (i.e., year 2007 = 100, year 2008 = 120, year 2009 = 140,and year 2010 = 210), which of the following is the simple moving average forecast for year 2011?

question

133.3

answer

A company wants to forecast demand using the simple moving average. If the company uses three prior yearly sales values (i.e., year 2008 = 130, year 2009 = 110, and year 2010=160), which of the following is the simple moving average forecast for year 2011?

question

128

answer

A company wants to forecast demand using the weighted moving average. If the company uses two prior yearly sales values (i.e., year 2009 = 110 and year 2010 = 130), and we want to weight year 2009 at 10% and year 2010 at 90%, which of the following is the weighted moving average forecast for year 2011?

question

158

answer

A company wants to forecast demand using the weighted moving average. If the company uses three prior yearly sales values (i.e., year 2008 = 160, year 2009 = 140 and year 2010 =170), and we want to weight year 2008 at 30%, year 2009 at 30% and year 2010 at 40%,which of the following is the weighted moving average forecast for year 2011?

question

Accuracy

answer

Which of the following is the major reason that exponential smoothing has become well accepted as a forecasting technique?

question

The most recent forecast

answer

The exponential smoothing method requires which of the following data to forecast the future?

question

232

answer

Given a prior forecast demand value of 230, a related actual demand value of 250, and a smoothing constant alpha of 0.1, what is the exponential smoothing forecast value for the following period?

question

5% to 10%

answer

If a firm produced a standard item with relatively stable demand, the smoothing constant alpha used in an exponential smoothing forecasting model would tend to be in which of the following ranges?

question

The more rapid the growth, the higher the percentage

answer

If a firm produced a product that is experiencing growth in demand, the smoothing constant alpha used in an exponential smoothing forecasting model would tend to be which of the following?

question

1,030

answer

Given a prior forecast demand value of 1,100, a related actual demand value of 1,000, anda smoothing constant alpha of 0.3, what is the exponential smoothing forecast value?

question

111

answer

A company wants to generate a forecast for unit demand for year 2011 using exponential smoothing. The actual demand in year 2010 was 120. The forecast demand in year 2010 was 110. Using this data and a smoothing constant alpha of 0.1, which of the following is the resulting year 2011 forecast value?

question

897

answer

As a consultant you have been asked to generate a unit demand forecast for a product for year 2011 using exponential smoothing. The actual demand in year 2010 was 750. Theforecast demand in year 2010 was 960. Using this data and a smoothing constant alpha of 0.3,which of the following is the resulting year 2008 forecast value?

question

Failing to include the right values

answer

Which of the following is a possible source of bias error in forecasting?

question

Mean absolute deviation

answer

Which of the following is used to describe the degree of error?

question

answer

A company has actual unit demand for three consecutive years of 124, 126, and 135. The respective forecasts for the same three years are 120, 120, and 130. Which of the following is the resulting MAD value that can be computed from this data?

question

answer

A company has actual unit demand for four consecutive years of 100, 105, 135, and 150.The respective forecasts were 120 for all four years. Which of the following is the resulting MAD value that can be computed from this data?

question

0.2

answer

If you were selecting a forecasting model based on MAD, which of the following MAD values reflects the most accurate model?

question

About 14.3

answer

A company has calculated its running sum of forecast errors to be 500 and its mean absolute deviation is exactly 35. Which of the following is the company's tracking signal?

question

The forecasting model is operating acceptably

answer

A company has a MAD of 10. It wants to have a 99.7 percent control limits on its forecasting system. Its most recent tracking signal value is 31. What can the company conclude from this information?

question

The forecasting model is out of control and needs to be corrected

answer

You are hired as a consultant to advise a small firm on forecasting methodology. Based on your research you find the company has a MAD of 3. It wants to have a 99.7 percent control limits on its forecasting system. Its most recent tracking signal value is 15. What should be your report to the company?

question

98.334 percent

answer

Which of the following is the portion of observations you would expect to see lying within a plus or minus 3 MAD range?

question

88.946

answer

Which of the following is the portion of observations you would expect to see lying within a plus or minus 2 MAD range?

question

1,640

answer

If the intercept value of a linear regression model is 40, the slope value is 40, and the value of X is 40, which of the following is the resulting forecast value using this model?

question

700

answer

A company hires you to develop a linear regression forecasting model. Based on the company's historical sales information, you determine the intercept value of the model to be 1,200. You also find the slope value is -50. If after developing the model you are given a value of X = 10, which of the following is the resulting forecast value using this model?

question

A causal relationship

answer

Heavy sales of umbrellas during a rain storm is an example of which of the following?

question

answer

You are using an exponential smoothing model for forecasting. The running sum of the forecast error statistics (RSFE) are calculated each time a forecast is generated. You find the last RSFE to be 34. Originally the forecasting model used was selected because it's relatively low MAD of 0.4. To determine when it is time to re-evaluate the usefulness of the exponential smoothing model you compute tracking signals. Which of the following is the resulting tracking system?

question

Work package

answer

A project can be subdivided into which of the following?

question

A statement of work

answer

A project starts out as which of the following?

question

A definition of the hierarchy of project tasks, subtasks, and work packages

answer

What is a work breakdown structure?

question

Projects are a way to promote effective leadership

answer

Which of the following is a reason that project management is important?

question

Time

answer

In a Gantt chart the horizontal axis is usually which of the following?

question

Cost and performance tracking schedule

answer

Which of the following is a graphic project report used in project management?

question

Lines of communication are shortened

answer

An advantage of a pure project where self-contained teams work full time on a project is which of the following?

question

A tean member can work on several projects

answer

Some of the advantages of a functional project where the project is housed in a functional division include which of the the following?

question

Matrix project

answer

A series of projects that are organized in such a way that each project utilized people from different functional areas is using which of the following organizational structures?

question

EVM chart

answer

You are looking at a chart that has the terms BCWS, BCWP and AC indicating lines on the chart. What kind of chart are you looking at?

question

Program Evaluation and Review Technique

answer

PERT is an abbreviation for which of the following methodologies?

question

Matrix project

answer

You have just been assigned to oversee a series of projects. Functional areas will loan you personnel for each project and separate project managers will be responsible for separate projects. These project managers will report to you. Which project management structure is being used?

question

Pure project

answer

You have been placed in charge of a large project. Shortened communication lines are required to insure quick resolution of problems as they arise. You recognize that the project is going to take a lot of time and require a lot of team pride, motivation, and commitment by all members. Which project management structure should you use in this situation?

question

A, B, D, E

answer

A simple project listening of five activities and their respective time estimates are presented below --> Using CPM, which actives make up the critical path?

question

12 days

answer

A simple project listening of five activities, their predecessors and their respective time estimates are presented below --> Using CPM, what is the Latest Finish Time for the last activity in this project (i.e., the total time to complete the project)?

question

answer

A simple project listing of five activities, their predecessors and their respective time estimates are presented below --> Using the CPM, which activities have slack in this project?

question

A, B, D, F, G

answer

A company must perform a maintenance project consisting of seven activities. The activities, their predecessors, and their respective time estimates are presented below --> Using CPM, which activities make up their critical path?

question

11 days

answer

question

C, E

answer

question

The slack for this activity is 2

answer

For an activity in a CPM analysis, the Early Finish time is 8 and the Late Finish time is 10. Which of the following statements is true?

question

The activity is on the critical path

answer

For an activity in a CPM analysis the Early Finish time is 20 and the Late Finish time is 20. Which of the following statements is true?

question

It specifies the relationships in the CPM network of activities

answer

A listing of immediate predecessor activities is important information in a CPM analysis for which of the following reasons?

question

You have multiple critical paths

answer

You have just performed a CPM analysis and have found that more than one path through the project network has zero slack values. What can you conclude?

question

A = $200, B = $300, C = $400

answer

You have the following time and cost information below for use in a Time-Cost CPM Scheduling model --> What are the three costs permit of time to expedite each activity?

question

Total time is 12 days, total cost is $1700

answer

Below are the data for a Time-Cost CPM Scheduling model analysis. The time is in days and the costs include both direct and indirect costs --> What are the total time of this project and total normal cost?

question

Total time is 11 days, total cost is $1850

answer

Below are the data for a Time-Cost CPM Scheduling model analysis. The time is in days and the costs include both direct and indirect costs --> If you crash this project to reduce the total time by one day what is the total time of the project and total cost?

question

Total time is 8 days, total cost is $2750

answer

Below are the data for a Time-Cost CPM Scheduling analysis. The time is in days and the costs include both direct and indirect costs --> If you crash this project to reduce the total time by four days, what is the total time of the project and total cost?

question

$2150

answer

You have collected the data for a Time-Cost CPM Scheduling model analysis. The time is in days and the project "direct costs" are given below --> The indirect costs for the project are determined on a daily duration basis. If the project lasts 16 days the total indirect costs are $400, 15 days they will be $250, 14 days they will be $200,and 13 days they will be $100. If you crash this project by one day what is the total (i.e., direct and indirect) project cost?

question

15 days

answer

You have collected the data for a Time-Cost CPM Scheduling model analysis. The time is in days and the project "direct costs" are given below --> The indirect costs for the project are determined on a daily duration basis. If the project lasts 16 days the total indirect costs are $400, 15 days they will be $250, 14 days they will be $200,and 13 days they will be $100. At what day do we achieve the lowest total project cost (i.e., direct plus indirect costs)?

question

You have reached the minimum total cost

answer

You know when you have arrived at the optimal solution in using the Time-Cost CPM Scheduling model analysis when what happens?

question

Negatively related

answer

In CPM analysis it is generally expected that the relationship between activity direct costs and project indirect costs will be which of the following?

question

Activities' sequential relationships can be specified and networked

answer

Which of the following is an assumption made in using CPM analysis?

question

Projects can change over time and networks can be inaccurate

answer

Which of the following is a criticism made about CPM analysis?

question

Complex projects can change over time and networks become inaccurate

answer

An assumption of CPM analysis is that project activities can be identified and have a clear beginning and ending point. Which of the following is a valid criticism of this assumption?

question

Economies of scope

answer

The ability to rapidly and inexpensively switch production from one product to another enables what are sometimes referred to as:

question

Intermediate range

answer

Capacity planning involving hiring, layoffs, some new tooling, minor equipment purchases, and subcontracting is considered as which one of the following planninghorizons?

question

Long-range

answer

Capacity planning involving acquisition or disposal of fixed assets such as buildings,equipment or facilities is considered as which one of the following planning horizons?

question

0.75

answer

If the best operating level of a piece of equipment is at a rate of 400 units per hour and the actual output during an hour is 300 units, which of the following is the capacity utilization rate?

question

1.25

answer

If the actual output of a piece of equipment during an hour is 500 units and its best operating level is at a rate of 400 units per hour, which of the following is the capacity utilization rate?

question

33 percent

answer

If the best operating level of a piece of equipment is at a rate of 400 units per hour and the actual output during an hour is 300 units, which of the following is the capacity cushion?

question

Plants within plants (PWP)

answer

The capacity focus concept can be put into practice through a mechanism called which of the following?

question

Provide a broader range of training

answer

The way to build in greater flexibility in your workers is to do which of the following?

question

Immediate product demand

answer

When deciding to add capacity to a factory which of the following need not be considered?

question

Forecasting raw material usage

answer

Which of the following is not a step used in determining production capacity requirements?

question

Decision trees

answer

Which of the following models uses a schematic model of the sequence of steps in a problem and the conditions and consequences of each step?

question

Demand can be smoothed by inventory policies

answer

Compared with a service operation, a manufacturing operation's capacity is which of the following?

question

Machine C

answer

At a decision point in a decision tree, which machine would you select when trying to maximize payoff when the anticipated benefit of selecting machine A is $45,000 with a probability of 90%; the expected benefit of selecting machine B is $80,000 with a probability of 50% and the expected benefit of selecting machine C is $60,000 with a probability of 75%?

question

All of the above

answer

What is an important difference between capacity planning in services as contrasted to capacity planning in manufacturing operations?

question

Short-range

answer

Capacity planning involving consideration of production scheduling and inventory position is characterized by which one of the following time durations?

question

Quality is free

answer

The philosophical leaders of the quality movement, Philip Crosby, W. Edwards Deming,and Joseph M. Juran had the same general message about what it took to achieve outstanding quality. Which of the following was not part of that message?

question

Customer focus

answer

question

Checksheets

answer

An analytical tool used in six-sigma quality improvement programs is which of the following?

question

Pass charts

answer

Which of the following is not an analytical tool used in six-sigma quality improvement programs?

question

Define

answer

A flow chart as part of a six-sigma quality improvement process might be found in which DMAIC category?

question

Analyze

answer

A fishbone diagram as part of a six-sigma quality improvement process might be found in which DMAIC category?

question

Improve

answer

An opportunity flow diagram as part of a six-sigma quality improvement process might be found in which DMAIC category?

question

Measure

answer

A Pareto chart as part of a six-sigma quality improvement process might be found in which DMAIC category?

question

Pareto charts

answer

Which of the following is an analytical tool used in six-sigma quality improvement programs?

question

Tendency analysis

answer

Which of the following is not an analytical tool used in six-sigma quality improvement programs?

question

Calculating a risky priority number for each possible failure

answer

Failure mode and effect analysis is used in six-sigma projects. It involves which of the following?

question

Determine the cause and effect relationships between process variables and output

answer

Design of experiments is a statistical methodology often used in six-sigma projects. It aims to accomplish which of the following?

question

Providing feedback to applicants by the examiners

answer

The Malcolm Baldrige award selection process helps improve quality and productivity bywhich of the following means?

question

Auditing firms

answer

Which of the following are eligible companies to be considered for the Baldrige award?

question

State highway patrol organizations

answer

Which of the following are not eligible to be considered for the Baldrige Award?

question

To improve competitiveness of American firms

answer

The primary purpose of the Malcolm Baldrige National Quality Award is which of the following?

question

Information and analysis

answer

The Grading Criteria of the Baldrige Award for total quality management includes which of the following?

question

Demonstrated outstanding quality in their products and processes

answer

The Malcolm Baldrige National Quality Award is given to organizations that have done which of the following?

question

Use of statistical quality control tools

answer

Which of the following is not a category reported in applying for the Baldrige Award?

question

Aesthetics

answer

The dimension of design quality that concerns the sensory characteristics of the product is which of the following?

question

Reliability

answer

The dimension of design quality that concerns the consistency of performance over time or the probability of failing is which of the following?

question

Features

answer

The dimension of design quality that concerns secondary characteristics is which of the following?

question

Features

answer

Which of the following is a dimension of design quality?

question

Aesthetics

answer

Which of the following is a dimension of design quality?

question

Failures are caused

answer

Which of the following is a basic assumptions that justify an analysis of the costs of quality?

question

Prevention costs

answer

A cost of quality classification is which of the following?

question

Internal failure costs

answer

Which of the following is the cost of quality classification for costs such as scrap, rework, or repair?

question

Appraisal costs

answer

Which of the following is the cost of quality classification for costs such as inspection, testing, and other tasks to ensure that the product or process is acceptable?

question

External failure costs

answer

Which of the following is the cost of quality classification for costs such as defects that pass through the system, such as customer warranty replacements, loss of customer or goodwill, handling complaints, and product repair?

question

Process flow diagram

answer

Which of the following tools uses a graphical representation of the production process to suggest potential sources of process variation?

question

Difference between the highest and lowest value in a sample

answer

In monitoring process quality we might use which of the following statistics?

question

The mean of the production process has shifted to the left of the design limits

answer

You have just used the capability index (Cpk) formulas to compute the two values "min [2,2.5]." Which of the following is the proper interpretation of these numbers?

question

The mean has not shifted at all

answer

You have just used the capability index (Cpk) formulas to compute the two values "min [1,1]." Which of the following is the proper interpretation of these numbers?

question

The mean of the productive process has shifted to the right of the design limits

answer

You have just used the capability index (Cpk) formulas to compute the two values "min[1.5, 1]." Which of the following is the interpretation of these numbers?

question

A change in a raw materials or operations

answer

Quality control charts usually have a central line and upper and lower control limit lines. Which of the following is not a reason that the process being monitored with the chart should be investigated?

question

A single plot falls above or below the control limits

answer

Quality control charts usually have a central line and upper and lower control limit lines. Which of the following is a reason that the process being monitored with the chart should be investigated?

question

1.2

answer

If there are 120 total defects from 10 samples, each sample consisting of 10 individual items in a production process, which of the following is the fraction defective that can be usedin a "p" chart for quality control purposes?

question

2.5

answer

If there are 400 total defects from 8 samples, each sample consisting of 20 individual items in a production process, which of the following is the fraction defective that can be usedin a "p" chart for quality control purposes?

question

0.08

answer

You want to determine the upper control line for a "p" chart for quality control purposes. You take several samples of a size of 100 items in your production process. From the samples you determine the fraction defective is 0.05 and the standard deviation is 0.01. If the desired confidence level is 99.7 percent, which of the following is the resulting UCL value for theline?

question

0.003

answer

You want to determine the lower control line for a "p" chart for quality control purposes.You take several samples of a size of 50 items in your production process. From the samples you determine the fraction defective is 0.006 and the standard deviation is 0.001. If the desired confidence level is 99.7 percent, which of the following is the resulting LCL value for the line?

question

2.58

answer

You want to determine the control lines for a "p" chart for quality control purposes. If the desired confidence level is 99 percent, which of the following values for "z" would you use incomputing the UCL and LCL?

question

0.0707

answer

You want to determine the control lines for a "p" chart for quality control purposes. If the total number of defects from all samples is 2,500, the number of samples is 100, and the sample size is 50, which of the following would be the standard deviation used in developing the control lines?

question

0.0335

answer

You want to determine the control lines for a "p" chart for quality control purposes. If the total number of defects from all samples is 560, the number of samples is 70, and the sample size is 80, which of the following would be the standard deviation used in developing the control lines?

question

Defective electrical switches

answer

For which of the following should we use a "p" chart to monitor process quality?

question

grades in a freshman "pass/fail" course

answer

For which of the following should we use a "p" chart to monitor process quality?

question

Tire pressures in an auto assembly plant

answer

With which of the following should we use an "X-bar" chart based on sample means to monitor process quality?

question

Tire pressures in an auto assembly plant

answer

Which of the following should we use an "R" chart to monitor process quality?

question

Students grades measure from 1 to 100

answer

Which of the following should we use an "R" chart to monitor process quality?

question

answer

You are developing an "X-bar" chart based on sample means. You know the standard deviation of the sample means is 4, the desired confidence level is 99.7 percent, and the average of the sample means is 24. Which of the following is your UCL?

question

9.68

answer

You are developing an "X-bar" chart based on sample means. You know the standard deviation of the sample means is 4, the desired confidence level is 99 percent, and the averageof the sample means is 20. Which of the following is your LCL?

question

8.9

answer

You want to develop a three-sigma "R" chart. You know the average range is 5 based on several samples of size 10. Which of the following is the resulting UCL?

question

0.0

answer

You want to develop a three-sigma "R" chart. You know the average range is 12 based on several samples of size 6. Which of the following is the resulting LCL?

question

0.27

answer

If you are going to develop an "X-bar" chart based on range statistics and you are using a sample size of 12 for your charting purposes. Which of the following is the A2 factor for the"X-bar" chart?

question

0.18

answer

If you are going to develop an "R" chart based on range statistics and you are using a sample size of 9 for your charting purposes. Which of the following is the lower control limit D3 factor for the chart?

question

1.65

answer

If you are going to develop an "R" chart based on range statistics and you are using a sample size of 15 for your charting purposes. Which of the following is the upper control limit D4 factor for the chart?

question

Fabrication

answer

Which of the following is not considered a major process flow structure?

question

Both A & C

answer

A difference between project and continuous flow categories of process flow structures is which two of the following?

question

1,000 units

answer

Assume a fixed cost for a process of $15,000. The variable cost to produce each unit of product is $10 and the selling price for the finished product is $25. Which of the following is the number of units that has to be produced and sold to break-even?

question

8,000 units

answer

Assume a fixed cost for a process of $120,000. The variable cost to produce each unit of product is $35, and the selling price for the finished product is $50. Which of the following isthe number of units that has to be produced and sold to break-even?

question

The company's total margin will be less than its investment

answer

You are hired as a consultant to decide if your client should purchase a new, highly specialized, piece of equipment. The product to be produced by this equipment is forecast to have a total world wide demand of 15,000 units over the entire product life. The initial investment to acquire and install the equipment is $256,000. The variable cost to produce each unit will be $15 and the selling price for the finished product will be $30. Which of the following best describes the situation the firm is facing?

question

Batches of more than 20 units should be run on machine B

answer

In a workcenter machine A has a ten minute set-up time per batch and a two minute per unit run time. Machine B performs the identical function but has a set-up time of thirty minutes and a one minute run time per unit. The workcenter makes products in batches ranging from one unit to one hundred units. Assuming capacity is not a limitation on either machine, on which batches should machine B be used?

question

Workcenter

answer

Which of the following is a basic type of process structure?

question

Product-process matrix

answer

Which of the following is not a basic type of process structure?

question

Assembly line

answer

Which of the following basic types of process structures is one which equipment or work processes are arranged according to the progressive steps by which the product is made?

question

Workcenter

answer

Which of the following basic types of process structures is one which similar equipment or functions are grouped together?

question

Emergency exits

answer

The placement of which of the following is not determined by process structure decisions?

question

9.6

answer

Using the assembly-line balancing procedure, which of the following is the required cycle time if the production time in minutes per day is 480 and the required output per day in units is 50?

question

0.72

answer

Using the assembly-line balancing procedure, which of the following is the required cycle time if the production time in minutes per day is 1440 and the required output per day in units is 2000?

question

answer

Using the assembly-line balancing procedure, which of the following is the theoretical minimum number of workstations if the task times for the six tasks that make up the job are 4, 6, 7, 2, 6, and 5 minutes, and the cycle time is 10 minutes?

question

answer

Using the assembly-line balancing procedure, which of the following is the theoretical minimum number of workstations if the task times for the eight tasks that make up the job are 7, 4, 7, 8, 9, 4, 3 and 6 minutes, and the cycle time is 8 minutes?

question

0.833

answer

You have just determined the actual number of workstations that will be used on an assembly line to be 6 using the assembly-line balancing procedure. The cycle time of the line is 5 minutes and the sum of all that tasks required on the line is 25 minutes. Which of the following is the correct value for the resulting line's efficiency?

question

0.750

answer

You have just determined the actual number of workstations that will be used on an assembly line to be 8 using the assembly-line balancing procedure. The cycle time of the lineis 10 minutes and the sum of all that tasks required on the line is 60 minutes. Which of the following is the correct value for the resulting line's efficiency?

question

Speed up the assembly line transfer mechanism

answer

When balancing an assembly line, which of the following is not a way to reduce the longest task time below the required workstation cycle time?

question

Little's Law

answer

The long-term relationship between the inventory, throughput, and flow time of a production system in steady state is called which of the following?

question

Average time between completions of successive units

answer

Which of the following best describes the term cycle time?

question

Diamond

answer

A process flowchart uses which of the following symbols to represent a decision point in a flow diagram?

question

Starving

answer

Which following production process term best describes the situation when activities in a stage of production must stop because there is no work?

question

Rapid delivery of a standard product

answer

An advantage of a make-to-stock process is which of the following?

question

Throughput time

answer

Which of the following terms describes the time a unit spends actually being worked on together with the time spent waiting in a queue?

question

Work-in-process/Throughput rate

answer

According to Little's Law, which of the following ratios is used to find throughput time?

question

Throughput rate times/Throughput time

answer

According to Little's Law, which of the following can be used to estimate work-in-process inventory?

question

Tasks to be performed

answer

When the textbook presented the topic of job design decisions, the "what" of these decisions concerned which of the following?

question

Automation of heavy manual work

answer

Job design decisions are being affected by which of the following trends?

question

Ease in learning the job

answer

Some of the advantages for labor to increasing specialization of labor in job design include which of the following?

question

Operations chart

answer

Which of the following work methods design aids might be used by a methods analyst in determining the best work methods to be used by a worker at a fixed workplace?

question

Time study

answer

Which of the following work methods design aids might be used by a methods analyst in determining the best work methods to be used by a worker at a fixed workplace? (2)

question

Equal to or greater than time spent working

answer

According the ideas of work physiology, if a job requires a caloric expenditure above 5 calories per minute, what rest period is necessary?

question

4.4 minutes

answer

If the normal time for a job is 4 minutes and the allowances for the job are 10 percent of normal time, which one of the following comes closest to the standard time for this job?

question

Worker illness

answer

Which of the following are not used as reasons to justify time allowances in a time study analysis?

question

To measure performance

answer

Which of the following is one of the primary reasons for work sampling?

question

How many observations are necessary

answer

In work sampling, which one of the following main issues must be decided before undertaking the study?

question

0.90

answer

A time study was made of a job to develop new time standards. A worker was observed for 30 minutes. During that time, 40 units were produced. The analyst rated the worker as performing at 120 percent performance rate. What is the normal time for this task?

question

1.00 minute

answer

question

$160,000

answer

A worker was producing a product for which the standard time was one minute per unit. During an eight hour workday, the worker produced 520 units. What would be the worker's pay for that day if the basic pay rate was $10.00 per hour and the piece rate bonus was $2.00 per unit above standard?

question

Shared integrated design databases

answer

Which of the following is an important element in the success of concurrent engineering?

question

The house of quality mix

answer

Which of the following is not an important element in the success of concurrent engineering?

question

Simplification of the product by reducing the number of separate parts

answer

Design for manufacturing and assembly delivers product improvements by emphasizing which of the following?

question

Virtual factory

answer

Which of the following is not considered a major process flow structure?

question

The stability of the product line

answer

The major difference between the job shop and batch shop categories of process flow structures is which of the following?

question

Assembly chart

answer

A chart used in process flow design depicting an exploded view of a product and its component parts is which of the following?

question

Number of projects completed

answer

Which of the following is a time-to-market performance measure used in judging product development performance?

question

Responsiveness to customer needs

answer

What dimension of competitiveness does time-to-market performance in product design and process selection impact?

question

1,000 units

answer

question

As a series of standard modules

answer

Global products are often designed to reflect which of the following?

question

Batches of more than 20 units should be run on machine center B

answer

In a job shop Machine Center A has a ten minute set-up time per batch and a two minute per unit run time. Machine Center B performs the identical function but has a set-up time of thirty minutes and a one minute run time per unit. The job shop makes products in batches ranging from one unit to one hundred units. Assuming capacity is not a limitation on either machine, on which batches should Machine Center B be used?

question

Cost per square foot of alternative facilities

answer

Which of the following is not considered an input to the layout decision in facility layout analysis?

question

Cellular layout

answer

Which of the following is a basic type of production layout format?

question

Flow-shop layout

answer

Which of the following basic types of production layout formats is one which equipment or work processes are arranged according to the progressive steps by which the product is made?

question

Process layout

answer

Which of the following basic types of production layout formats is one which similar equipment or functions are grouped together?

question

A small team of workers who turn out complete units of work

answer

We would expect to see in a group technology layout which of the following?

question

Temperature

answer

In the design of retail service layouts, the term "ambient conditions" could refer to which of the following?

question

Lighting

answer

In the design of retail service layouts, the term "ambient conditions" could refer to which of the following?

question

Backtracking kept to a minimum

answer

Some of the suggestions for a good layout for manufacturing and back-office operations include which of the following?

question

The physical surroundings in which the service takes place

answer

The term "servicescape" refers to which of the following?

question

Machines which have randomly spaced service requirements

answer

Which of the following is an example of a finite population in a queuing system

question

Last in, first out

answer

Which of the following is not a queue discipline discussed in the textbook?

question

Multichannel, single phase

answer

Buying food at a large food store with multiple checkout counters features which type of queuing system line structure?

question

Single channel, single phase

answer

Getting an autograph from a famous person might involve standing in which type of queuing line structure?

question

Single channel, multiphase

answer

In a college registration process, several department heads have to approve an individual student's semester course load. What is the queuing system line structure?

question

0.5 hours

answer

Assume the service rate for a queue in a truck-loading operation is 2 trucks per hour. Using the infinite queuing notion for the models presented in the textbook which of the following is the average service time?

question

0.2 hours

answer

If the arrival rate for loading trucks is 5 trucks per hour, what is the mean time between arrivals?

question

Self-service approach

answer

Which of the following is one of the three contrasting approaches to delivering on-site service?

question

Production line approach

answer

Which of the following is one of the three contrasting approaches to delivering on-site service?

question

McDonald's Corporation

answer

Which company pioneered the production line approach to delivering on-site service?

question

Self-service approach

answer

Which of the following approaches to service design is characterized by having the customer take a greater role in the production of the service?

question

Each element of service system consistent with the operating focus of the firm

answer

Which of the following is a characteristic of a well-designed service system?

question

Physician practice

answer

Which of the following is considered a high-contact service operation?

question

Task

answer

There are many applications of poka-yokes in service organizations. Which of the following is one of the three-T's used to classify poka-yokes?

question

Low production efficiency

answer

In the service-system design matrix, a face-to-face total customization service encounter is expected to have which of the following?

question

Low sales opportunity

answer

In the service-system design matrix, a mail contact service encounter is expected to have which of the following?

question

All of the above are inputs

answer

Which of the following would not be considered an input in the airline business?

question

Blocking

answer

________ is when the activities in the stage must stop because there is no place to deposit the item just completed.

question

Blocking and starving

answer

The most common things that can happen when two stages are directly linked are:

question

Single stage or multi stage, make to stock or make to order, paced or non paced

answer

Processes can be characterized as:

question

Make-to-stock processes can be controlled based on the actual or anticipated amount of finished goods inventory. and Make-to-stock process is used when demand is seasonal and the firm does not have enough capacity to keep up during the peak season.

answer

Which of the following is true about make-to-stock processes?

question

Utilization

answer

According to your text, the most common process metric is:

question

Cycle time

answer

The average time between completion of units is commonly known as:

question

Setup time

answer

In practice, often _______ time is not included in the utilization of the process.

question

Changing the sequence of activities

answer

Throughput time cannot be reduced in a process by:

question

Inputs, outputs, transformations

answer

A process consists of all the following except:

question

Utilization

answer

The ______________ is the ratio of the time that a resource is actually activated relative to the time that it is available for use.

question

Buffer

answer

An area between stages where output is stored prior to its use in a downstream stage is called:

question

Make to stock

answer

A _______________ process ends when the inventory of finished goods has been completed. Customer orders are then served from this inventory.

question

363.33 minutes

answer

A machine is designed to produce units at a rate of 30 per minute or one unit every two seconds. The setup time to configure the machine is 30 minutes. What is the operation time to make a batch of 10,000 units?

question

120 units entering a system and 120 units exiting

answer

Which of the following is an example of a steady rate assembly line?

question

All of the above are true

answer

A production process is often depicted as a funnel. If liquid is poured into the funnel at a rate greater than it can exit:

question

Flexibility improves

answer

An advantage of a touch-screen self-order kiosk in a fast food restaurant is:

question

Run time

answer

The time required to produce a batch of parts is called:

question

The value added time is the sum of all the activity

answer

If all activities included in a production process are value-added activities, which of the following is true?

question

All of the above

answer

The trends affecting job design decisions include:

question

A and B

answer

The advantage(s) of specialization of labor to management include:

question

Little difficulty in learning job

answer

Which of the following is an advantage of specialization of labor for labor?

question

Work physiology

answer

Which of the following is not a job design principle that individuals or work groups require as a logical integration of work activities?

question

A and B

answer

The reasons for work measurement standards include:

question

Observed performance time per unit x performance rating

answer

In a time study the normal time is equal to:

question

A, B, and C

answer

The primary applications of work sampling include:

question

Provides a complete breakdown of elements

answer

The advantage(s) of work sampling compared to time study include all the following EXCEPT:

question

Pierce rate

answer

The basic elements of a Scanlon Plan include all but:

question

Pierce rate

answer

The reward/incentive plan that allows management to target specific output goals is:

question

Project

answer

According to Hayes and Wheelwright, which of the following is not a major process flow structure?

question

Continous flow

answer

The type of processing structure that is used to produce gasoline, chemicals, and steel is:

question

Assembly line

answer

The type of processing structure that is used for producing discrete products at higher volume is:

question

Heavy equipment

answer

An example of a business/industry that uses batch flow process structure is:

question

Both A and B

answer

he major decision variables in equipment selection are:

question

Assembly line

answer

The best process flow structure to use for making automobiles is?

question

The point where cost is minimized

answer

A break even point indicates which of the following:

question

Linear layout

answer

Which of the following is not a basic type of production layout?

question

Pattern of workflow

answer

The basic difference between product and process layout pertains to:

question

Product layout

answer

A flow shop layout is often referred to as a:

question

0.6

answer

A company wants to produce 800 units during a day where the assembly line operates a full 8-hour shift. The required cycle time in minutes is:

question

answer

The total time to complete all of the tasks for the assembly line referred to in #4 is 2.3 minutes. The theoretical minimum number of stations needed is:

question

Slower tooling changes

answer

Which of the following is not a benefit of a group technology layout?

question

All of the above

answer

Important servicescape elements include:

question

A and C

answer

Generalizations that can be made pertaining to the nature of services include:

question

Field-based services

answer

Home repair services are an example of:

question

A, B, and D

answer

The service triangle includes:

question

Greater; greater

answer

The ______ the percentage of contact time between the service system and the customer, the ________ the degree of interaction between the two during the production process.

question

Accessibility

answer

The item "most" emphasized by the survey respondents of the 1997 survey conducted by Roth, Chase, and Voss was:

question

All of the above are identified

answer

Which of the following is not an alternative identified in the service-system design matrix?

question

Face-to-face total customization

answer

______________ refers to service encounters whose specifications must be developed through some interaction between the customer and the server.

question

A, B, and C

answer

Which of the following statements is not true about the strategic uses of the service-system design matrix?

question

Personal attention approach

answer

The approach to delivering on-site service made famous by Nordstrom department stores is:

question

Ensures the firm makes a profit

answer

Which of the following is not an element of a good service guarantee?

question

All of the above

answer

The major components of the queuing system are:

question

Length of the arrival

answer

In the queuing system, which of the following is not an arrival characteristic?

question

First come, first served

answer

The most common priority rule/queuing discipline is:

question

Multiple channel, multiple phase

answer

The admission of patients in a hospital is a typical example of:

question

Balking

answer

A customer who arrives, looks, and then leaves is:

question

Cost of goods sold/Average aggregate inventory value

answer

The inventory turnover ratio used in measuring supply-chain efficiency is found by the ratio of which of the following?

question

Average aggregate inventory value

answer

The total value of all items held in inventory for the firm at cost is which of the following?

question

234

answer

If the average aggregate inventory value is $45,000 and the cost of goods sold is $10,000,which of the following is weeks of supply?

question

104

answer

If the average aggregate inventory value is $1,200,000 and the cost of goods sold is $600,000, which of the following is weeks of supply?

question

0.5

answer

If the average aggregate inventory value is $1,200,000 and the cost of goods sold is $600,000, which of the following is inventory turnover?

question

4.5

answer

If the average aggregate inventory value is $100,000 and the cost of goods sold is $450,000, which of the following is inventory turnover?

question

Risk hedging

answer

n Hau Lee's uncertainty framework to classify supply chains, a supply chain for functional products with an evolving supply process is called which of the following?

question

Efficient

answer

In Hau Lee's uncertainty framework to classify supply chains, a supply chain for functional products with a stable supply process is called which of the following?

question

Agile

answer

In Hau Lee's uncertainty framework to classify supply chains, a supply chain for innovative products with an evolving supply process is called which of the following?

question

Responsive

answer

In Hau Lee's uncertainty framework to classify supply chains, a supply chain for innovative products with a stable supply process is called which of the following?

question

Bullwhip effect

answer

The effect of the lack of synchronization among supply-chain members is referred to as which of the following?

question

Activities involving shareholders

answer

In outsourcing which of the following internal activities and decision responsibilities cannot be transferred to outside contractors?

question

Improve effectiveness by focusing on what the firm does best

answer

Which of the following is an organizationally-driven reason for outsourcing?

question

Improve credibility and image by associating with superior providers

answer

Which of the following is not an organizationally-driven reason for outsourcing?

question

Shorten cycle time

answer

Which of the following is an improvement-driven reason for outsourcing?

question

Enhance effectiveness by focusing on what you do best

answer

Which of the following is not an improvement-driven reason for outsourcing?

question

Giving the outsourcing partner opportunities to become a strong competitor

answer

When considering outsourcing, what should firms be sure to avoid?

question

Agile supply chain

answer

Which is the most challenging kind of supply chain to manage according to Hau Lee?

question

Innovative products

answer

Which of the following of Fisher's product categories includes fashionable clothing, personal computers and other products that typically have a very brief life cycle?

question

Increase commitment in a non-core area

answer

Which of the following is not an improvement-driven reason to outsource?

question

Coordination

answer

Which of the following is one of the strategic characteristics to consider when deciding how supplier relationships should be structured on the continuum between vertical integration (do not outsource) to arm's length relationships (outsource)?

question

Confer with environmental groups

answer

The six-step process for green sourcing does not include which of the following?

question

Develop the sourcing strategy

answer

The six-step process for green sourcing includes which of the following?

question

Taxes

answer

Ownership costs are incurred after the initial purchase and are associated with the ongoing use of the product or material. Which of the following is not an ownership cost listed in thetext?

question

Quality costs

answer

Acquisition costs include which of the following costs?

question

Supply chain costs

answer

Ownership costs include which of the following costs?

question

The service facilities we wish to model are connected to each other

answer

We may prefer a simulation model to a queuing model when:

question

Historical cost

answer

Which of the following is not a criterion that influences manufacturing plant or warehouse facility location decisions?

question

Gross national product

answer

Which of the following is a not criterion that influences manufacturing plant or warehouse facility location decisions?

question

Immigration rules

answer

Which of the following is not a criterion that influences manufacturing plant or warehouse facility location decisions?

question

Proximity to customers

answer

Which of the following is a criterion that influences manufacturing plant or warehousefacility location decisions?

question

The willingness of local politicians to provide favorable treatment for a consideration

answer

An important issue in facility location analysis is business climate. An unfavorable business climate could be indicated by which of the following?

question

Historical costs

answer

One of the objectives of facility location analysis is to select a site with the lowest total cost. Which of the following costs should be excluded from the analysis?

question

Incidental costs

answer

One of the objectives of facility location analysis is to select a site with the lowest total cost. Which of the following costs should not be included in the analysis?

question

Becoming less responsive to the custoemr

answer

One of the objectives of facility location analysis is to select a site with the lowest total cost. Which of the following are hidden costs that should be included in the analysis?

question

Movement of preproduction material between locations

answer

One of the objectives in facility location analysis is to select a site with the lowest total cost. Which of the following costs are hidden costs that should be included in the analysis?

question

Adequate low cost labor

answer

Which of the following is not an infrastructure criteria used in facility location analysis?

question

About 260

answer

How many free trade zones are there in the United States?

question

North American Free Trade Agreement countries

answer

An example of a trading bloc is which of the following?

question

Centroid method

answer

Which of the following is a plant location methodology good for locating a single facility within a set of existing facilities based in distances and volumes of goods shipped?

question

To determine which corner of a street intersection to locate a retail service facility

answer

In which of the following situations should we not use the transportation method of linear programming?

question

Volume of goods to be shipped between existing points

answer

The centroid method for plant location uses which of the following data?

question

About 115

answer

Plant A is located at the (X, Y) coordinates of (100, 200) and has a volume of shipping of 500 units a day. Plant B is located at the (X, Y) coordinates of (150, 400) and has a volume of shipping of 200 units a day. Using the centroid method, which of the following is the X coordinate for the new plant location?

question

About 389

answer

Plant A is located at the (X, Y) coordinates of (200, 500) and has a volume of shipping of 400 units a day. Plant B is located at the (X, Y) coordinates of (300, 100) and has a volume of shipping of 300 units a day. Using the centroid method, which of the following is the X coordinate for the new plant location?

question

(88, 138)

answer

A company wants to determine where they should locate a new warehouse. They have two existing production plants (i.e., Plant A and Plant B) that will ship units of a product to this warehouse. Plant A is located at the (X, Y) coordinates of (50, 100) and will have volume of shipping of 250 units a day. Plant B is located at the (X, Y) coordinates of (150, 200) and will have a volume of shipping of 150 units a day. Using the centroid method, which of thefollowing are the X and Y coordinates for the new plant location?

question

Pipeline

answer

What transportation mode has very high initial investment costs but gives a very low cost per mile for products that are highly specialized and require no packaging?

question

Highway

answer

Very few products are moved without at least part of their journey being by which modeof transportation?

question

Customer contact

answer

Which of the following refers to the physical presence of the customer in a service system?

question

Mail

answer

Which of the following are alternative possible degrees of customer contact included in the Service-System Design Matrix?

question

Internet

answer

Which of the following is a degree of customer/server contact included in the service-system design matrix?

question

Low production efficiency

answer

In the service-system design matrix, a face-to-face loose specs service encounter is expected to have which of the following?

question

High production efficiency

answer

In the service-system design matrix, an internet and on-site technology service encounter is expected to have which of the following?

question

Segment the customers

answer

Which of the following is a suggestion for managing queues that is mentioned in the textbook?

question

Periodically close the service channel to temporarily disperse the line

answer

Which of the following is not a suggestion for managing queues presented in the textbook?

question

Determine an acceptable waiting time for your customers

answer

Which of the following is not a suggestion for managing queues presented in the textbook?

question

Train your servers to be friendly

answer

Which of the following is a suggestion for managing queues presented in the textbook?

question

The number of servers and the waiting line

answer

Which of the following are the two major components of a queuing system?

question

Machines which have randomly spaced service requirements

answer

Which of the following is an example of a finite population in a queuing system?

question

Soonest promise date

answer

Which of the following queue discipline is mentioned in the textbook?

question

Multichannel, single phase

answer

Buying a ticket for a college football game where there are multiple windows to buy theticket at features which type of queuing system line structure?

question

Single channel, single phase

answer

Standing in line to buy a ticket for a movie where there is only one window to buy ticketsis which type of queuing system Line Structure?

question

Single channel, single phase

answer

A roller coaster ride in an amusement park employs which type of queuing system line structure?

question

Single channel, single phase

answer

Machine breakdown and repair in a twelve machine factory having one repair mechanic would develop which type of queuing system line structure concerning machine breakdowns?

question

Multichannel, single phase

answer

Machine breakdown and repair in a twelve machine factory having three repair mechanics would develop which type of queuing system line structure concerning machine breakdowns?

question

12 minutes

answer

If the arrival rate for loading trucks is 5 trucks per hour, what is the mean time between arrivals?

question

Can not be determined

answer

A company is concerned about the number of customers that have to wait for service in their customer service department. Assume the rate at which customers are serviced is 12 per hour. Using the infinite queuing notion for the models presented in the textbook which of the following is the mean time between arrivals?

question

An online dating service

answer

An example of a virtual service is which of the following?

question

A service encounter that conforms to specifications

answer

A service blueprint is not which of the following?

question

Tear-out cards in magazines

answer

Which of the following are not examples of poka-yokes described in the text?

question

Process planning

answer

In an overview of the major operations planning activities in a typical organization, which of the following activities precedes aggregate sales and operations planning?

question

Vehicle loading

answer

In an overview of the major operations planning activities in a typical logisticsorganization, which of the following activities follows aggregate sales and operations planning?

question

Workforce scheduling

answer

In an overview of the major operations planning activities in a typical service organization, which of the following activities follows aggregate sales and operations planning?

question

Vehicle capacity planning

answer

In an overview of the major operations planning activities in a typical logistics organization, which of the following activities immediately follows aggregate sales and operations planning?

question

Workforce levels and inventory on hand

answer

The main purpose of aggregate operations planning is to specify the optimal combination of which of the following?

question

Raw material availability and competitor's behavior

answer

In conducting aggregate operations planning there are a number of required inputs. Which of the following are inputs considered external to the firm?

question

Competitors' behavior and economic conditions

answer

In conducting aggregate operations planning there are a number of required inputs. Which of the following are inputs considered external to the firm?

question

Current physical capacity and current workforce

answer

In conducting aggregate operations planning there are a number of required inputs. Which of the following are considered inputs internal to the firm?

question

Level

answer

Which of the following is a production planning strategy presented in the textbook?

question

Stable workforce, variable work hours

answer

Which of the following is considered a "pure" production planning strategy?

question

Chase

answer

Matching the production rate to the order rate by hiring and laying off employees as the order rate varies is which of the following pure production planning strategies?

question

Level

answer

Maintaining a stable workforce working at a constant output rate while shortages and surpluses are absorbed by fluctuating inventory levels, order backlogs and allowing lost salesis which of the following production planning strategies?

question

Backordering costs

answer

Which of the following costs are relevant to aggregate operations planning?

question

1,340

answer

Using the cut-and-try method for aggregate operations planning we can determine the production requirement in units of product. If the beginning inventory is 100 units, the demand forecast is 1,200, and the necessary safety stock is 20% of the demand forecast, which of the following is the production requirement?

question

600

answer

Using the cut-and-try method for aggregate operations planning we can determine the production requirement in units of product. If the beginning inventory is 500 units, the demand forecast is 1,000, and the necessary safety stock is 10% of the demand forecast, which of the following is the production requirement?

question

There is a smooth flow throughout the production system

answer

An advantage of the level strategy for aggregate operations planning is which of the following?

question

Purchased items from vendors can be delivered when and where needed

answer

An advantage of the level strategy for aggregate operations planning is which of the following?

question

Cut and try

answer

Which of the following methods requires generating several alternative aggregate plans?

question

Inventory is perishable

answer

From an operational perspective yield management is most effective under which of the following circumstances?

question

Demand is stable and close to capacity

answer

From an operational perspective yield management is least effective under which of the following circumstances?

question

The product can be kept to be sold when demand is stronger

answer

From an operational perspective yield management is least effective under which of the following circumstances?

question

Management acumen

answer

Which of the following is not a major strategic operational competitive dimension that forms a company's competitive position?

question

Cost or price

answer

A major competitive dimension that forms a company's strategic operational competitive position in their strategic planning is which of the following?

question

Technical liaison

answer

When developing an operations and supply strategy, which of the following is an important product-specific criterion to consider?

question

Supplier after-sale support

answer

In development of an operations and supply strategy, which of the following would be an important product-specific criteria to consider?

question

Straddling

answer

When a company seeks to match the benefits of a successful position while maintaining its existing position in offering customers a variety of differing services, what is this process called?

question

A network that shows how a company's strategy is delivered to customers

answer

An activity-based map is which of the following?

question

Earnings per share

answer

Which of the following is not a measure of operations and supply management efficiency used by Wall Street?

question

Receivable turnover

answer

Which of the following is a measure of operations and supply management efficiency used by Wall Street?

question

Output/Materials

answer

Which of the following is a partial measure of productivity?

question

Output/(Labor + Capital + Energy)

answer

Which of the following is a multifactor measure of productivity?

question

Output/Inputs

answer

Which of the following is a total measure of productivity?

question

Partial measure

answer

If all you knew about a production system was that total daily output was 400 units and the total labor necessary to produce the 400 units was 350 hours, what kind of productivity measure could you use to compute productivity?

question

Partial measure and multi factor measure

answer

If all you knew about a production system was that total daily output was 400 units and the total labor necessary to produce the 400 units was 350 hours, and the total materials used were 425 units, what kind of productivity measure could you use to compute productivity?

question

1,428

answer

The total output from a production system in one day is 500 units and the total labor necessary to produce the 500 units is 350 hours. Using the appropriate productivity measure, which of the following numbers represents the resulting productivity ratio?

question

1.000

answer

The total output from a production system in one day is 900 units and the total labor necessary to produce the 900 units is 900 hours. Using the appropriate productivity measure, what is the resulting productivity ratio?

question

8.97

answer

Larry's Auto Body Repair Shop had revenues that averaged $60,000 per week in April and $50,000 per week in May. During both months, the shop employed six full-time (40 hours/week) workers. In April the firm also had four part-time workers working 25 hours per week but in May there were only 2 part-time workers and they only worked 10 hours per week. What is the percentage change in labor productivity from April to May for Larry's Auto Body Repair?

question

2.88

answer

Various financial data for SunPath Manufacturing for 2010 & 2011 follow --> What is the percentage change in SunPath's total productivity measure between 2010 & 2011?

question

10.39

answer

Various financial data for SunPath Manufacturing for 2010 & 2011 follow --> What is the percentage change in the energy partial productivity measure for SunPath between 2010 & 2011?

question

2.33

answer

Various financial data for SunPath Manufacturing for 2010 & 2011 follow --> What is the percentage change in the labor partial productivity measure for SunPath between 2010 & 2011?

question

-0.53

answer

Various financial data for SunPath Manufacturing for 2010 & 2011 follow --> What is the percentage change in the multifactor labor and raw materials productivity measurefor SunPath between 2010 & 2011?

question

A philosophy of waste elimination

answer

Which of the following are related to lean production?

question

Overproduction

answer

In the textbook Toyota's Fujio Cho identified which of the following types of waste to be eliminated?

question

Product defects

answer

In the textbook Toyota's Fujio Cho identified which of the following types of waste to be eliminated?

question

Motion

answer

In the textbook Toyota's Fujio Cho identified which of the following types of waste to be eliminated?

question

Hidden inventory

answer

Which of the following is a key inventory reduction target under lean production?

question

Quality at the source

answer

Which of the following addresses elimination of waste under lean production?

question

Kanban production control system

answer

Which of the following is an element that addresses elimination of waste under lean production?

question

Reducing waiting time between process operations

answer

Group technology (GT) is credited with which of the following benefits?

question

In a paperless control system, containers can be used instead of cards

answer

Which of the following statements holds true for Kanban production control systems?

question

answer

In setting up a Kanban control system you need to determine the number of Kanban cardsets needed. If the expected demand during lead time is 25 per hour, the safety stock is 20% of the demand during lead time, the container size is 5, and the lead time to replenish an order is 5 hours, what is the number of Kanban card sets needed?

question

120

answer

In setting up a Kanban control system you need to determine the number of Kanban card sets needed. If the expected demand during lead time is 50 per hour, the safety stock is 20% of the demand during lead time, the container size is 4. If the lead time to replenish an order is8 hours, what number of Kanban card sets is needed?

question

answer

You have been called in as a consultant to set up a Kanban control system. The first thing to do is to determine the number of Kanban card sets needed. Your research shows that the expected demand during lead time for a particular component is 150 per hour. You estimate the safety stock should be set at 25% of the demand during lead time. The tote trays used as containers can hold 8 units of stock and the lead time it takes to replenish an order is 2 hours. Which of the following is the number of Kanban card sets necessary to support this situation?

question

6,300

answer

You have been called in as a consultant to set up a Kanban control system. The first thing you do is to determine the number of Kanban card sets needed. Your research shows that the expected demand during lead time for a particular component is 1,200 per hour. You estimatethe safety stock should be set at 5% of the demand during lead time. The tote trays used as containers can hold 2 units of stock and the lead time to replenish an order is 10 hours. Which of the following is the number of Kanban card sets necessary to support this situation?

question

Design for work flow balance

answer

In designing a lean production facility layout a designer should do which of the following?

question

Level scheduling

answer

When implementing a lean production system a stabilized schedule is achieved using which of the following?

question

Reduce lot sizes

answer

To implement a Kanban pull system a firm would do which of the following?

question

Reduce lead times

answer

In implementing a lean production system you should work with suppliers to do which of the following?

question

Make frequent deliveries

answer

In implementing a lean production system you should work with suppliers to do which of the following?

question

Reduce setup/changeover time

answer

To implement a flow process in developing a lean system a firm might do which of the following?

question

Balance workstation capacities

answer

To implement a flow process in developing a lean system a firm might do which of the following?

question

Total costs will be lower for the Kanban/lean production operation

answer

Imagine comparing a manufacturing operation using regular lot-sizing and the same operation with a Kanban/lean production approach. What would be your expectations of the difference between the total cost (i.e., inventory holding costs + setup/ordering costs) of each?

question

No extra inventory

answer

In a lean production system we expect to see which of the following?

question

Freeze windows

answer

Which of the following is a lean production technique that is not reported in the textbook to have been successfully applied in service firms?

question

Backflush

answer

An activity where the parts that go into each unit of a product are periodically removedfrom inventory and accounted for based on the number of units produced is called which of the following?

question

Leveling the facility load

answer

Which of the following is a lean production technique that has been successfully applied in service firms?

STUDY

Bad Debts Expense Economic Order Quantity Fact And Opinion Management Quality Assurance

Internal 4 – Flashcards 54 terms

Deloris Connelly

54 terms

Preview

Internal 4 – Flashcards

question

1. The internal auditor completed work on a segment of the engagement work program. As a result, the auditor determined that a modification of the organization's distribution procedures is required. The auditee agreed and has implemented revised procedures. The internal auditor should: a. Research the problem and recommend in the final engagement communication measures that should be taken. b. Jointly develop and communicate an appropriate recommendation. c. Communicate the problem and assume that management will take appropriate action. d. Indicate in the final engagement communication that the client determined and implemented corrective action.

answer

question

2. Internal auditors should communicate engagement results promptly but should be careful about communicating matters with legal ramifications. Thus, the roles of the internal audit activity and legal counsel should be defined and policies should be established regarding methods of communication. These measures should address how internal auditors' communications may appropriately be shielded from being sued against the organization during legal proceedings. Assuming that the law applies to such matters, communications are most likely to be protected when they: a. Consist of documents delivered to an attorney before the attorney- client relationship came into existence. b. Are created for self-evaluation after the events resulting in a private litigant's claim. c. Are made to an attorney whether or not in confidence. d. Are part of the internal auditors' work product and are sought by a government agency.

answer

question

It is the policy of some organizations to have auditees respond to audit reports by writing to an administrative vice president who has the primary responsibility for follow-up. Under such arrangements, copies of responses are usually sent to the auditing department which reviews them for adequacy. If the auditing department considers the response to a particular report inadequate, which of the following would be the most appropriate course of action? a. Perform a follow-up audit immediately. b. Follow up in connection with the next regularly scheduled audit. c. Schedule a follow-up audit within six months. d. Inform the administrative vice president that the response is not considered adequate, and coordinate with the vice president on any additional follow-up

answer

question

Management is beginning to take corrective action on personnel department deficiencies reported during the last internal audit. According to the Standards, the internal auditor should a. Oversee the corrective action. b. Postpone the next audit of the personnel department until the corrective action is completed. c. Refrain from judging whether the corrective action will remedy the deficiencies. d. Follow up to see that the corrective action satisfies the audit recommendations.

answer

question

During an audit of purchasing, internal auditors found violations of company policy concerning competitive bidding. The same condition had been reported in an audit report last year and corrective action had not been taken. Which of the following best describes the appropriate action concerning this repeat finding? a. The audit report should note that this same condition had been reported in the prior audit. b. During the exit interview, management should be made aware that a finding from the prior report had not been corrected. c. The director of internal auditing should determine whether management or the board has assumed the risk of not taking corrective action. d. The director of internal auditing should determine whether this condition should be reported to the independent auditor and any regulatory agency.

answer

question

Recommendations in audit reports may, or may not, actually be implemented. Which of the following best describes internal auditing's role in follow-up on audit recommendations? Internal auditing a. Has no role; follow-up is management's responsibility. b. Should be charged with the responsibility for implementing audit recommendations. c. Should follow up to ascertain that appropriate action is taken on audit recommendations. d. Should request that independent auditors follow up on audit recommendations

answer

question

After an audit report with adverse findings has been communicated to appropriate auditee personnel, proper action is to a. Schedule a follow-up review. b. Implement corrective action indicated by the findings. c. Examine further the data supporting the findings. d. Assemble new data to support the findings.

answer

question

According to the Standards, the internal audit director should ensure follow-up of prior audit findings and recommendations. a. To determine if corrective action was taken and is achieving the desired results. b. Unless management rejected the recommendation in their initial response. c. Unless the audit schedule does not allow time for follow-up. d. Unless management has accepted the recommendation.

answer

question

Why should organizations require auditees to promptly reply and outline the corrective action that has been implemented on reported deficiencies? a. To remove items from the pending list as soon as possible. b. To effect savings or to institute compliance as early as possible. c. To indicate concurrence with the audit findings. d. To ensure that the audit schedule is kept up to date

answer

question

If an auditor finds that no corrective action has been taken on a prior audit finding that is still valid, the Standards state that the auditor should a. Restate the prior finding along with the findings of the current audit. b. Determine whether management or the board has assumed the risk of not taking corrective action. c. Seek the board's approval to initiate corrective action. d. Schedule a future audit of the specific area involved.

answer

question

Which of the following is most likely to result in lack of corrective action by operating management on audit findings? a. Exclusion from the written report of those audit findings with which the auditee concurs. b. Omission of any pre-audit meetings. c. Discussion of audit findings with the auditee as they are uncovered. d. Insertion of a summary of the auditee's opposing views in the audit report.

answer

question

Discussing audit findings with an auditee in advance of draft¬ing a report is most advantageous when: a. Management has indicated concurrence with the recommendations during informal discussions. b. Corrective action is not needed. c. The findings are significant to operations and correction is needed immediately. d. Management has already taken corrective action.

answer

question

Oral audit reports: a. Are a necessity when a manager cannot, or will not, read a written report. b. Usually require less factual support than is needed for formal written reports. c. Tend to only be used when timeliness is not a factor. d. Do not need the careful organization required for written findings.

answer

question

After an operational auditor writes a report describing problem areas in need of correction, the next step is to review the report in draft form with the: a. Appropriate vice president. b. Auditee's supervisor. c. Departmental manager for the operations that were audited. d. Treasurer

answer

question

The primary reason for having written formal audit reports is to a. Provide an opportunity for auditee response. b. Direct senior management to corrective actions. c. Provide a formal means by which the external auditor assesses potential reliance on the internal audit department. d. Record findings and recommended courses of action.

answer

question

When the auditor and the auditee reviewed the draft audit report, they found they interpreted the facts differently. The auditor should a. Eliminate the item from the audit report. b. State only the auditor's position in the report. c. Refer the matter to the auditee's supervisor for review and resolution. d. Report both interpretations.

answer

question

In which section of the final report should the internal auditor describe the audit objectives? a. Purpose b. Scope c. Criteria d. Condition

answer

question

Which of the following elements of an audit report is not always required? a. A statement that describes the audit objectives. b. A statement that identifies the audited activities. c. Pertinent statements of fact. d. An evaluation of the impact of the findings on the activities reviewed.

answer

question

Which of the following statements would be appropriate as a conclusion (opinion) in an internal audit report of the results of an audit of your company's branch operations? a. Statistical sampling was used to determine the extent of unauthorized purchases from the imprest fund. b. The audit of branch operations was conducted in accordance with the Standards. c. The vice-president of branch operations should require the timely review of the daily transaction report as a means of monitoring purchases from the imprest fund. d. Except for the unauthorized purchases from the imprest fund, the system of internal controls over branch operations appears to be working well.

answer

question

An objective report is one that is described as a. Through content and tone, designed to help the auditee as well as the organization. b. Logical and easily understood. c. To the point and free of unnecessary detail. d. Factual, unbiased, and free from distortion.

answer

question

Audit report content and format may vary; but according to the Standards, which of the following is a necessary element? a. Statement of audit objectives b. Status of findings from prior reports c. Related activities not audited d. Documentation of previous oral communications

answer

question

Which of the following would be most appropriate for inclusion in the management summary of a final internal auditing report? a. Auditee responses to recommendations. b. A concise statement of audit findings. c. Reference to areas not covered by the audit. d. Discussion of recommendations given in prior years' reports.

answer

question

Which of the following best defines an audit opinion? a. A summary of the significant audit findings. b. The auditor's professional judgment of the situation that was reviewed. c. Conclusions that must be included in the audit report. d. Recommendations for corrective action.

answer

question

The internal auditing department for a chain of retail stores recently concluded an audit of sales adjustments in all stores in the southeast region. The audit revealed that several stores are costing the company an estimated $85,000 per quarter in duplicate credits to customers' charge accounts. The audit report, published 8 weeks after the audit was concluded, included the internal auditors' recommendations to store management that should prevent duplicate credits to customers' accounts. Which of the following standards for reporting has been disregarded in the above case? a. The follow-up actions were not adequate. b. The auditors should have implemented appropriate corrective action as soon as the duplicate credits were discovered. c. Auditor recommendations should not be included in the report. d. The report was not timely

answer

question

According to the Standards, audit findings are the result of a. Comparing what should be with what is and analyzing the impact. b. Determining the impact on the organization of what should be. c. Communicating the impact on the organization of what should be. d. Analyzing differences between organizational and departmental objectives.

answer

question

Audit findings often emerge by a process of comparing "what should be" with "what is." Findings are based on the attributes of criteria, condition, cause, and effect. From the following descriptions, which one most appropriately describes the effect of the audit finding? a. Reason for the difference between the expected and actual conditions. b. Factual evidence found during the course of the examination. c. Risk or exposure encountered because of the condition. d. Standards, measures, or expectations used in making the evaluation.

answer

question

An internal auditor has just completed an audit of a division and is in the process of preparing the audit report. According to the Standards, the findings in the audit report should include a. Statements of opinion about the cause of a finding. b. Pertinent factual statements concerning the control weaknesses uncovered during the course of the audit. c. Statements of both fact and opinion developed during the course of the audit. d. Statements concerning potential future events that may be helpful to the audited division.

answer

question

In beginning an audit, an internal auditor reviews written procedures that detail segregations of responsibility adopted by management to strengthen internal controls. These written procedures should be viewed as which attribute of a finding? a. Criteria. b. Condition. c. Cause. d. Effect.

answer

question

Interim reports are issued during an audit to a. Explain the purpose of the audit. b. Eliminate the need for a final report. c. Communicate information requiring immediate attention. d. Define the scope of the audit so the final report can be brief.

answer

question

As an internal auditor for a multinational chemical company, you have been assigned to perform an operational audit at a local plant. This plant is similar in age, siting, and construction to two other company plants that have been recently cited for discharge of hazardous wastes. In addition, you are aware that chemicals manufactured at the plant release toxic by-products. Assume that you have evidence that the plant is discharging hazardous wastes. As a Certified Internal Auditor, what is the appropriate reporting requirement in this situation? a. Send a copy of your audit report to the appropriate regulatory agency. b. Ignore the issue because the regulatory inspectors are better qualified to assess the danger. c. Issue an interim report to the appropriate levels of management. d. Note the issue in your working papers, but do not report it.

answer

question

Which of the following is not an advantage of issuing an interim report? a. Final report-writing time can be minimized. b. An interim report allows information requiring immediate attention to be communicated. c. An interim report can be conducted on an informal basis, and may be communicated only verbally. d. A formal, written interim report may negate the need for a final report in certain circumstances.

answer

question

Audit policy requires that final reports not be issued without a management response. An audit with significant findings is complete except for management's response. Evaluate the following courses of action and select the best alternative. a. Issue an interim report regarding the important issues noted. b. Modify audit policy to allow a specific time period for the management response. c. Wait for management's response and then issue the audit report. d. Discuss the situation with the external auditors.

answer

question

A relatively new internal auditor is completing an audit report. The final report should most appropriately be signed by a. The auditor because of a greater level of detail knowledge of the report. b. The auditor and the person in charge of the area being audited to indicate review of the report. c. The director of internal auditing. d. The chair of the audit committee of the board of directors.

answer

question

Summary written audit reports are ordinarily intended for a. Local operating management. b. Review by other auditors only. c. High-level management and/or the audit committee. d. Mid-level staff management.

answer

question

Internal audit reports should: a. Include a section describing the scope of the audit. b. Be written with objectivity. c. Include a section describing the audit procedures. d. All of the above.

answer

question

Which of the following is the most appropriate method of reporting disagreement between the auditor and the auditee concerning audit findings and recommendations? a. State the auditor's position because the report is designed to provide the auditor's independent view. b. State the auditee's position because management is ultimately responsible for the activities reported. c. State both positions and identify the reasons for the disagreement. d. State neither position. If the disagreement is ultimately resolved, there will be no reason to report the previous disagreement. If the disagreement is never resolved, the disagreement should not be reported because there is no mechanism to resolve it.

answer

question

A purpose of the audit closing conference is to a. Inform members of the board of directors of audit results. b. Present the audit report to the chief executive officer. c. Obtain information to evaluate internal control. d. Generate commitment for appropriate managerial action

answer

question

Formal audit reports should be written in a manner directed to the needs of which of the following parties? a. Auditee management and the director of internal auditing. b. The chief executive officer and the audit committee of the board. c. All persons directly and indirectly concerned with the activities covered. d. Auditee management and upper-level management directly concerned with the activities covered.

answer

question

Which of the following situations is most likely to be the subject of a written interim report to auditee management? a. Seventy percent of the planned audit work has been completed with no significant adverse findings. b. The auditors have decided to substitute survey procedures for some of the planned detailed review of certain records. c. The audit program has been expanded because of indications of possible fraud. d. Open burning at a subsidiary plant poses a prospective violation of pollution regulations.

answer

question

According to the IIA Standards, an opinion should be expressed a. In audit reports as appropriate. b. In each financial audit report. c. In each operational audit report. d. If called for by the audit program.

answer

question

The development of a distribution list for each audit report is important because it a. Indicates the people who have responsibilities with regard to the report. b. Limits the circulation of the audit report to the auditee and the auditee's immediate supervisor. c. Ensures that the audit committee and key officers are informed of the contribution of the internal audit department. d. Reinforces the need for audit report to be complete, dealing with all minor and major audit findings.

answer

question

Which of the following would represent a material deficiency finding in an audit of accounts payable? a. Failure to record a liability for goods in transit, shipped FOB destination. b. Duplicate payment of a small amount. c. Payment of an invoice a week before its due date. d. Preparation of a trial balance by the accounts payable clerk.

answer

question

Which of the following objectives is best achieved by an oral presentation of the audit report? a. Conveying the need for prompt action to key management personnel. b. Suggesting recommendations to be implemented prior to the issue of the final written report. c. Reporting findings to the auditee manager without informing the manager's superior. d. Interacting with key personnel to counter misperceptions and provide additional information.

answer

question

The scope section of an internal audit report should identify a. The audit techniques used. b. Any limitations imposed. c. The sampling methodology employed. d. Any unresolved differences with auditees

answer

question

The person responsible for audit report distribution should be a. The director of internal auditing or designee. b. The audit committee of the board of directors. c. The vice president responsible for the area being audited. d. The audit supervisor of the audit being performed

answer

question

Certain information may not be appropriate for disclosure to all report recipients because it is privileged, proprietary, or related to improper or illegal acts. If conditions being reported involve improper acts of a senior manager, the report should be distributed to a. The external auditor. b. The board of directors. c. The stockholders. d. Senior management.

answer

question

The internal auditing unit has recently completed an operational audit of its company's accounts payable function. The audit director decided to issue a summary report in conjunction with the final report. Who would be the most likely recipient of just the summary audit report? a. Accounts payable manager. b. External auditor. c. Controller. d. Audit committee of the board of directors.

answer

question

Which of the following would not be considered an objective of the audit closing or exit conference? a. To resolve conflicts. b. To discuss the findings. c. To identify concerns for future audits. d. To identify management's actions and responses to the findings.

answer

question

One purpose of the exit conference is for the internal auditor to a. Require corrective action for deficiencies found. b. Review and verify the appropriateness of the audit report based upon auditee input. c. Review the performance of audit personnel assigned to the engagement. d. Present the final audit report to management.

answer

question

Exit conferences serve to ensure the accuracy of the information used by an internal auditor. A secondary purpose of an exit conference is to a. Get immediate action on a recommendation. b. Improve relations with auditees. c. Agree to the appropriate distribution of the final report. d. Brief senior management on the results of the audit.

answer

question

According to the IIA Standards, if management and the board decide not to take action on an auditor's recommendation, the auditor should a. Continue to make the recommendation in subsequent reports. b. Take the recommendation to the audit committee. c. Document their decision. d. Change the recommendation.

answer

question

Who should be directly responsible for assessing the adequacy of reported corrective action on audit finding related to excessive rework? a. The audit committee of the board. b. The chief executive officer's staff. c. The director of quality control d. The internal audit department.

answer

question

Upon reviewing the results of the audit report with the audit committee, management agreed to accept the risk of not implementing corrective action on certain audit findings. Select the best alternative for the internal auditing director. a. Notify regulatory authorities of management's decision. b. Perform additional audit steps to further identify the policy violations. c. Conduct a follow-up audit to determine whether corrective action was taken. d. Internal audit responsibility has been discharged, and no further audit action is required.

answer

question

When management agrees with a finding and has agreed to take corrective action, the appropriate treatment is to a. Report that management has agreed to take corrective action. b. Omit the finding and recommendation. c. Report that management has already taken corrective action. d. Include the finding and recommendation, irrespective of management's agreement.

answer

STUDY

Economic Order Quantity Inventory Management System Management Mechanical Engineering Quality Assurance Total Quality Management

5.3 Lean Production and Quality Management (HL only) – Flashcards 15 terms

Sonia Kelly

15 terms

Preview

5.3 Lean Production and Quality Management (HL only) – Flashcards

question

Andon

answer

Is a lean production method that uses visual control systems to indicate the status of an aspect of the production process, e.g. machinery, production line or work process. (Higher Level)

question

Benchmarking

answer

is the process of identifying best practice in an industry, in relation to products, processes and operations. It set the standards for firms to emulate. (Higher Level)

question

Cradle to cradle (C2C)

answer

Is a sustainable model of production based on natural processes. The underlying principle is that there is no waste in nature, making production sustainable for future generations. (Higher Level)

question

ISO 9000

answer

Is the world's most widely recognised standard for quality management. It is endorsed by the ISO to firms that use quality management systems to meet the needs of customers. (Higher Level)

question

Just in time (JIT)

answer

is an inventory management system based on stocks being delivered as and when they are needed in the production process. As stocks are delivered just before they are used, there is no need to have buffer stocks. (Higher Level)

question

Kaizen

answer

is the Japanese term for 'continuous improvement' a lean production philosophy where workers and managers continually try to find ways to improve work processes and efficiency. (Higher Level)

question

Kanban

answer

is a method of lean production used to ensure that inventory is based on actual customer orders using a card system with an inventory number attached to each component in the production process. (Higher Level)

question

Lean production

answer

refers to the approach used to eliminate waste (muda) in an organisation. As a result, lean organisations benefit from higher productivity and lower cost. (Higher Level)

question

Quality

answer

mean that a good or serves must be fit for its purpose by meeting or exceeding the expectations of the consumer. (Higher Level)

question

Quality assurance

answer

refers to the methods used by a business to reassure customers about that its products by meeting certain quality standards such as the ISO 9000. (Higher Level)

question

Quality circles

answer

are groups of workers that meet on a regular basis to identify problems related to quality assurance, to consider alternative solutions to the identified problems, and make feasible recommendations for improvement. (Higher Level)

question

Quality control

answer

is the traditional way of quality management that involves checking and reviewing work processes. This is usually carried out by quality controllers and inspectors. (Higher Level)

question

Quality management

answer

is the function concerned with controlling business activities to ensure that products are fit for their purpose. The quality of a product is seen as an overall package, from the production and purchase is seen as an overall package, from the production and purchase of the product to its use and beyond (after-sales care). (Higher Level)

question

Total Quality Management (TQM)

answer

is the process that attempts to encourage all employees to make quality assurance paramount to the various functions (production, finance, marketing and HRM) or an organisation. (Higher Level)

question

Zero defects

answer

is the goal of producing each and every product without any mistakes or imperfections, thereby eliminating waste and reworking time (the time taken to correct faults.) (Higher Level)

STUDY

Economic Order Quantity Fixed Order Quantity

SCMT 3643 – Flashcard 175 terms

Ken Ericksen

175 terms

Preview

SCMT 3643 – Flashcard

question

The 7-Rs of supply chain management include

answer

-right place -right time -right quantity -right quality -right price -right condition -right customer

question

The international environment presents challenges for the international logistician. Which aspect of the international business environment is most likely to create the greatest frustrations?

answer

cultural differences

question

The EPA's SmartWaySM Transport Partnership program is a voluntary effort between the government and the transportation industry to develop and implement methods to improve air quality and reduce greenhouse gas emissions in transportation.

answer

True

question

Transportation spend account for nearly two thirds of logistics dollar in the United States' gross domestic product (GPD).

answer

True

question

Inventory carrying costs account for nearly two thirds of logistics dollar in the United States' gross domestic product (GPD

answer

False

question

The complexity of logistics and transportation. are often accentuated as Global supply chains increase in length (distance and time).

answer

True

question

The faster it moves the greater the transportation spend

answer

True

question

Logistics cluster theory suggests an area can develop a substantial competitive advantage by providing several logistics service providers in one area. The area then attracts export- and import-minded manufacturers.

answer

True

question

International trade is still mostly concentrated among the developed countries of the Northern Hemisphere. Which country is the largest importer of the world?

answer

United States

question

Inbound logistics refers to the finished products inbound to the final customer

answer

False

question

Infrastructure is a collective term that refers to all of the elements in place (publicly or privately owned goods) to facilitate transportation, communication, and business exchanges.

answer

True

question

The majority of containerships currently in use are post-Panamex ships.

answer

False

question

When a company has a subsidiary in a foreign country, as far as the foreign country's government is concerned that subsidiary is ___.

answer

importer of record

question

A tailored approach, where an agent is used in some countries, a distributor in others, and a marketing subsidiary in the remainder is a strategy some firms us for entering foreign markets contrasted to a standardized approach. The decision depends on the characteristics of the market and resources.

answer

True

question

Cultural issues are not considered to be challenging for international logistician.

answer

False

question

China's share of global manufacturing exports has risen from 2% of the world's total exports to over 50% in 2010.

answer

False

question

A lazy executive thinks about sourcing globally based on the idea of reducing costs.

answer

True

question

Internet services are extremely reliable for global business services thanks to the acceptance of cell phones.

answer

False

question

Of the following, the best definition of a logistics infrastructure would be that it consists of

answer

all of the elements in place to facilitate transportation, communication, and business exchanges

question

Because agents tend to be individuals or very small firms, governments in some countries put them under ___.

answer

labor law

question

Our guest speaker, Gary Maxwell shared with you one of his most important learnings while working in various Walmart international markets was "fit your Brands to the Culture."

answer

True

question

Global railroads are important for expediting trade and every country in the world uses the same gage (width of tracks).

answer

False

question

According to international convention, every ship must be registered in a specific country and fly that country's flag. The country in which a ship is registered determines applicable onboard ship laws, taxes the owners pay and regulations followed onboard a vessel.

answer

True

question

The Heckscher-Ohlin Theory holds that counties that have an abundance of certain resources enjoy an absolute or comparative advantage over other countries. Which of the following not one of the factors that Heckscher and Ohlin considers scarce?

answer

Education

question

Container ships carry 60% of the world's trade.

answer

True

question

Dry Bulk Carriers carry coal, agricultural product, ores, scrap iron, and other bulk commodities.

answer

True

question

The idea that containerized ocean cargo needs to take a shortcut across a landmass by rail has resulted in the development of bad bridges.

answer

False

question

NVOCCs are:

answer

Stands for Non Vessel owning Common Carrier; operation comprises of sales, stuffing transport of the containers to gateway ports

question

The Transportation Infrastructure allows businesses to sustain their daily operations. This requires reliable electricity, energy (natural gas), water, and sewer services.

answer

False

question

The most common type of ship charters are time charters and voyage charters.

answer

True

question

Flags of Convenience is a designation of the open registry of a country that has lower taxes and more lenient on-board regulations than other countries with open registries.

answer

True

question

A Dry Lease agreement in which the owner of the aircraft provides only the airplane to the lessee, who is responsible for all other costs.

answer

True

question

In 1945, representatives of 31 scheduled carriers assembled in Havana to officially organize the International Air Transport Association (IATA) to address route structures and fares.

answer

True

question

The Warsaw Convention of 1929 limited the liability of international airlines in accidents.

answer

True

question

In countries with poor traditional telephone services, communications infrastructure has rapidly been developed through

answer

Cellular telephones

question

In calculating airfreight rates, airlines figure the volume-weight of the shipment based on the volume yielding a certain weight value. As a result, ___.

answer

the airline will charge the higher of the volume-weight or the actual weight of the cargo

question

International trade is still mostly concentrated among the developed countries of the Northern Hemisphere. Which country is the largest importer of the world?

answer

United States

question

The Carriage of Goods by Sea Act (COGSA) became U.S. law in 1936 and signified the U.S. agreement with the Law Relating to Bills of Lading known as the Hague Rules from the 1924 Hague international liability convention.

answer

True

question

United and Delta Airlines are examples of integrated air cargo carriers.

answer

False

question

The following are functional areas often classified as Inbound Logistics

answer

Purchasing

question

Ships too large to pass through the Panama Canal are called ___.

answer

Post-Panamax Ships

question

It is possible to hedge against rises in charter rates through the Baltic Exchange, where shippers can buy future contracts for shipping capacity.

answer

True

question

The greatest net profit growth and margin remains in North America.

answer

False

question

Documentary collection is a process by which the exporter asks bank to protect its interests in importing country by not releasing documents (specifically bill of lading which is certificate of title to the goods) until importer meets certain requirements

answer

True

question

A consular invoice is a regular commercial invoice printed on stationery provided by a country and visa-ed by its consulate in the exporter s country.

answer

True

question

The sentence This merchandise licensed by U.S. for ultimate destination [country]. Diversion contrary to U.S. Law prohibited is ___

answer

Destination Control Statement

question

In most cases, an intermodal bill of lading ___.

answer

is a straight bill of lading when the name of the consignee is specified.

question

Weight and dimensional packaging information is necessary in order to build pallets effectively for international shipping.

answer

True

question

A commercial invoice for exporting does not contain financial data.

answer

False

question

In the U.S. trucking accounts for 38% of all freight in tons moved, but only 7% of transportation revenue paid.

answer

False

question

The European Community has recently introduced the concept of ___ that run trains straight through from major ports to cities such as Milan and Vienna without changing locomotives and crews at each border.

answer

Freight corridors

question

Economies of scale of larger ships that cannot go through Panama Canal may be substituted with a land bridge via rail from the port of Seattle to an East Coast U.S. port.

answer

True

question

Oversize cargo is shipped on a "flat rack" container.

answer

True

question

A TEU is a twenty foot container.

answer

True

question

Malcom McLean demonstrated that it was feasible to move ocean freight in containers for about 15.8 cents per ton compared to about $5.83 per ton with conventional processes of the time.

answer

True

question

The sentence "This merchandise licensed by U.S. for ultimate destination [country]. Diversion contrary to U.S. Law prohibited" is

answer

a destination control statement

question

In order for an importer to come under the scope of informed compliance, it must show that it has exercised reasonable care in the filing of its Customs entries.

answer

True

question

A packing list contain financial data.

answer

False

question

The U.S. State Department recently eliminated their foreign services division charged with assisting small and medium size U.S. companies interested in exporting to foreign countries.

answer

False

question

A medical device is not legal in country A, but is legal in country b. Despite being restricted from country A, the product is allowed to go through the foreign trade zone of country A on its way to country B.

answer

False

question

Documentation designed to indicate what country a product initially came from is contained in the ___.

answer

Certificate of Origin

question

The main billing document in a shipment is the pro forma invoice.

answer

False

question

SDR, an artificial currency, is designed to supplement the U.S. dollar in its role as the international currency.

answer

True

question

The United States requests the "sewing tickets" for some garments, an internal work document of the garment factory, as well as the time cards of the employees working there in an attempt to determine the country of origin of textile products. This can be an example of a non-tariff barrier.

answer

True

question

The complexity of logistics and transportation. are often accentuated as Global supply chains increase in length (distance and time).

answer

True

question

The Export-Import Bank (Ex-Im) is a United States federal agency whose purpose is to provide assistance to U.S. exporters in the form of loans, loan guarantees, and political risk insurance policies.

answer

True

question

As a company grows in exporting sophistication, it should not become involved with an export trading company because

answer

customers abroad are customers of the export trading company, not the exporter.

question

A cargo service that allows an exporter to ship a large quantity of goods to a location not normally served by cargo airlines would be ___.

answer

charter airfreight service

question

Intermodal containers sometimes collapse in rough seas.

answer

True

question

Successful supply chain strategies cannot be expected to simultaneously lower costs, increase service levels and reduce inventory quantities.

answer

False

question

Most cargo tends to be shipped by air in its

answer

secondary packaging

question

Of the following, the best definition of a logistics infrastructure would be that it consists of

answer

all of the elements in place to facilitate transportation, communication, and business exchanges.

question

The converted tanker ship Ideal X carried 58 containers on April 26, 1956 from the Port of Newark; loading each container on board in about 7 minutes.

answer

True

question

Cigna is a marine insurance company. Lloyd's and the International Underwriting Association are involved in forms of insurance.

answer

True

question

The total capacity of the ship expressed in long tons is called ___.

answer

deadweight tonnage

question

Companies will often seek to sell or source oversea to reduce costs.

answer

True

question

The faster it moves the greater the transportation spend

answer

True

question

An exporter can conduct its international business in a manner similar to the way it and most companies conduct domestic business by using ___.

answer

An open account

question

It is possible to find insurance for improper packing.

answer

False

question

Performance measurement is important because:

answer

Lower-level metrics in an organization must connect directly to the high-level performance to achieve goals

question

Which of the following are not key attributes of supply chain management?

answer

o Inventory control o Leveraging technology o Customer power o A long-term orientation

question

Logistics can be crucial to achieving desired levels of performance in supply chains.

answer

True

question

The only water link between the Black Sea and the oceans is:

answer

The Bosporus Strait

question

When a successful exporter involves one of its suppliers (or a company that makes a complementary product) in the markets that this exporter has developed, it results in a form of piggy-backing sometimes called collaborative exporting.

answer

True

question

When a firm realizes that it wants to exploit the possibilities that sales abroad can bring, and decides to become directly involved in its exporting activities, it is said to be involved in:

answer

Active Exporting

question

The global consulting group, Booz Allen and Hamilton defined a rationale for global sourcing that included:

answer

All of these

question

A certificate of insurance is a document provided by the insurance company of the exporter that attests that the goods are insured during their international voyage. This certificate is obtained only at the request of the importer, and for transactions under certain Incoterm terms of trade, such as CIF and CIP.

answer

True

question

A consular invoice is a regular commercial invoice printed on stationary provided by a country and visa-ed by its consulate in the exporter's country.

answer

True

question

A standard TEU container is 8 feet wide (2.44 meters) and 8.5 feet tall (2.59m).

answer

True

question

According to Eurostat 2012 statistics of freight carried in millions of tonnes railroads accounted for only about 7% of total freight hauled in Europe.

answer

True

question

According to the United Nations ocean export commission all international shipments must have an insurance policy.

answer

False

question

An Airway Bill fulfills same functions as ocean bill of lading but for air freight and is always a straight air waybill.

answer

True

question

Another land bridge is across Russia to connect Europe and Africa

answer

False

question

Another land bridge is via North Korea from a land bridge from South Korea over Russia's Trans-Siberian railway to Europe.

answer

False

question

Documentary collection is a process by which the exporter asks bank to protect its interest in importing country by not releasing documents (specifically bill of lading which is certificate of title to the goods) until importer meets certain requirements.

answer

True

question

Drafts are sometimes used to provide customers (importers) access to lower cost money in the exporter's home country

answer

True

question

End-Use Certificates _____.

answer

Certify that the product is going to be used for a legitimate purpose

question

Export quotas can be used to control scarce resources or prices of products for which a country has a monopoly.

answer

True

question

In most cases, an intermodal bill of lading _____.

answer

Is a straight bill of lading when the name of the consignee is specified

question

In the U.S. rail accounts for 33% of al freight in tons moved, but only 7% of transportation revenue paid.

answer

True

question

Intermodal describes a shipment that takes several different means of transportation (road, rail, ocean, air) from is point of departure (seller/exporter) to its point of destination (buyer/importer).

answer

True

question

Ocean containers must have palletized freight to ship legally.

answer

False

question

The amount of duties charged by U.S. Customs depends on:

answer

o The type of goods; their classification o The value of the goods; their valuation o The country from which the goods originated; the rules of origin

question

Sometimes a third bank, in addition to the issuing bank and the advising bank, becomes involved with a letter of credit. This bank is called a _____.

answer

o Primary bank o Amending bank o Intermediary bank o **None of these o Secondary bank

question

The converted tanker ship Ideal X carried 58 containers on April 26, 1956 from the Port of Newark; loading each container on board in about 7 minutes.

answer

True

question

The European Community has recently introduced the concept of _____ that run trains straight through from major ports to cities such a Milan and Vienna without changing locomotives and crews at each border.

answer

Freight corridors

question

The sentence This merchandise licensed by U.S. for ultimate destination [country]. Diversion contrary to U.S. Law prohibited is ____.

answer

Destination Control Statement

question

Which of the following are international documents?

answer

o Commercial invoice o Packing list o Airway bill

question

Which of the following pieces of information does an international commercial invoice contain?

answer

o Incoterms o Terms of payment o A precise description of the product o Weight and measurements of the product

question

An international airway bill

answer

Is non-negotiable

question

A forward market hedge consists of selling forward the currency that will eventually be collected from a foreign receivable.

answer

True

question

EAR stands for Export Administration Regulations, and it contains the Commerce Control List, which details which commodities and product can and cannot be certain countries.

answer

True

question

Generally speaking, countries with scarce foreign currency resources will attempt to limit the granting of import licenses to companies that have generated export revenues and ___.

answer

Companies purchasing goods for which no close domestic substitute is available

question

Goods imported in the United States are valued on an FAS or CFA basis, or the value of the goods as they were leaving the exporting country compared to most of the rest of the world that uses the value when entering the importer's country.

answer

True

question

International exchange rates began to float ___.

answer

o And it changed the role of the International Monetary Fund o At the end of the gold standard o In 1971

question

Letters of credit are used:

answer

o When sellers are not familiar with buyers and want to use banks as a trusted intermediary to ensure payment o By governments in some instances to control the flow of foreign currencies in and out of their countries o By international conglomerates as a way to control their cash flow

question

Logistics in the 1980s was split between Inbound Logistics and Outbound Logistics.

answer

True

question

Special Drawing Rights (SDRs) of the IMP are an artificial currency whose value is determined by the value of a basket of four currencies: the euro, the Japanese yen, the U.S. dollar, and the British pound.

answer

True

question

SWIFT is the Society for Worldwide Interbank Financial Telecommunications.

answer

True

question

The Export-Import Bank (Ex-Im) is a United States federal agency whose purpose is to provide assistance to U.S. exporters in the form of loans, loan guarantees, and political risk insurance policies.

answer

True

question

The IMF was created to oversee the fixed exchange rate system created by the Bretton-Woods Conference. Today it helps countries manage their balance of payments and lends them money when they experience difficulties with their balance of payments.

answer

True

question

The International Maritime Dangerous Goods Code regulates the shipment of dangerous goods by ocean.

answer

True

question

The stated goal of the European Union is to eventually transform the euro to be a challenger to the U.S. dollar in its role as a preferred third-country currency.

answer

True

question

The U.S. State Department offers assistance to small and medium size companies interested in exporting to foreign countries.

answer

True

question

The United States requires a Shippers Export Declaration.

answer

True

question

We discussed some basic definitions, including

answer

o Supply chain management is the integration of business processes from end user through original suppliers that provide products, services, and information that add value for customers. o Logistics which can be summer up as follow the inventory. o Logistics is the management of the flow and storage of inventory so that total costs are minimized and customer services are achieved

question

When the invoice's value is much below what Customs has historically accepted and when a much higher valuation is reached with one of the alternative valuation methods, customs can determine that the exporter is dumping the goods in the importing country.

answer

True

question

Which one of the following functional areas is not classified as Outbound Logistics?

answer

Purchasing

question

A cargo service that allows an exporter to ship a large quantity of goods to a location not normally served by cargo airlines would be ___.

answer

Charter airfreight service

question

A freight consolidator is almost always quite good at packaging a container properly, with proper dunnage and protection, but the owners of other cargo on board the consolidated container may not be as careful, and that represents a hazard.

answer

True

question

According to John Waite, chief surveyor of the Salvage Association, the biggest hazard(s) for container ships is/are

answer

Fire

question

Among the companies that are exposed to risks in currency fluctuation are ___.

answer

o Firms that have management that is not well-versed in the intricacies of international trade o Firms that do not evaluate international currency transaction risks clearly and that do not follow a specific policy on currency exchange

question

An intermediary that purchases goods in the exporting country and resells them to a customer in a foreign country is called a(n) ___.

answer

o None of these*** o Principal o Export management corporation o Agent o Contract manufacturer

question

As a company grows in exporting sophistication, it should not become involved with an export trading company because

answer

Customers abroad are customer of the export trading company, not the exporter

question

LNG and LPG ships ____.

answer

Often operate on long-term contracts

question

At Lloyd's, individuals assuming (insuring) risks are on their personal fortunes called ___.

answer

Bespoke Names

question

Of the following, the best definition of a logistics infrastructure would be that it consists of

answer

All of the elements in place to facilitate transportation, communication, and business exchanges

question

On occasion, a firm will respond to a competitor's move by retaliating. For example, Linde Gas (an American firm producing industrial gasses) entered the French market when Air Liquide (a French company in the same industry) decided to enter th U.S. market. Such a move is considered a ___.

answer

Competition driver

question

Packaging designed to appeal to and be functional for consumers is called

answer

Primary packaging

question

Ship dedicated to the transport of petroleum products are called ___.

answer

Crude carriers

question

Since most airports are geographically close to large cities, their hours of operations are generally limited by ________ constraints.

answer

Noise

question

Some countries regulate primary package sizes by requiring them to be multiples of simple metrics units.

answer

True

question

The concept of general average is exclusively used in marine insurance.

answer

True

question

The International Product Life Cycle Theory explains why there are no televisions manufactured in Great Britain and the United States, although that technology was invented in those countries.

answer

True

question

The three functions of correct packaging are

answer

To protect goods in transit, to facilitate proper handling of goods in transit, and fulfill the shipper's customer service strategy

question

TradeCard, created in 1994, combines document handling and payment in one process and utilizes electronic transmission of documents and guarantees payment to the exporter.

answer

True

question

cargo freighters carry nearly 60% of global air freight

answer

true

question

The 2013 boeing global forecast confirms that continuing trend toward smaller passenger aircraft

answer

false

question

With the advent of cell phones and the internet, mail service is no longer of concern in most countries

answer

false

question

Fedex is an integrated carrier

answer

true

question

Only 50% of petroleum producers own their own ships, the rest are charters

answer

false

question

Certified cargo screening facilities are charged with

answer

conducting 100% inspections of all shipments that will eventually travel on passenger aircraft

question

Important functions of IATA today, include setting airport, crewing, and navigation safety standards

answer

true

question

The aircraft can carry freight and passengers on the main deck are called mixed aircraft

answer

false - combi

question

In its absolute form, the exchange rate determination theory of purchasing power parity

answer

all of these

question

The commercial invoice

answer

none of these (accompanies the shipment)

question

An intermediary that purchases goods in the exporting country and resells them to a customer in a foreign country is called

answer

export trading company

question

The tax an importer must pay in order to be allowed to let goods into the country is called a duty

answer

true

question

an experienced exporter knows that the u.s. government almost always checks the paperwork that the exporter provides to the importer

answer

false

question

A letter of credit contains the following information

answer

the consignee and consignor

question

If the exporter and the importer agree that a transaction will be in the currency of the exporters country, the exporter then bears all the risk of exchange rate fluctuation.

answer

false

question

In addition to being a contract of carriage and a receipt for the goods, an ocean bill of landing is

answer

a packing list for the carrier

question

In the United States, the Federal Reserve System technically fulfills the role of being a central bank

answer

true

question

A country may use import documents to enact a protectionist policy

answer

false

question

From the view point of the seller open accounts is the best payment method

answer

false

question

A standby letter of credit is similar to a "simple"letter of credit except for

answer

all of these

question

A packing list always accompanies a shipment

answer

True

question

in 1996, the Export Administration Regulations(ERA) was revised to a U.S. export policy stating that everything is authorized unless it is specifically prohibited

answer

true

question

Besides a contract and a receipt for goods, an ocean bill of landing is

answer

A certificate of title

question

A pro-forma invoice is not a true invoice (it is a quote) and the expiration date on a pro forma invoice is very important

answer

True

question

The harmonized commodity description and coding system also called HS uses up to 10 digits. the first 6 digits are the same in all countries while the last 4 are country specific, used to differentiate different subcategories of main product

answer

True

question

The international bank of Reconstruction is known as the World Bank and was founded after the Bretton woods conference to help countries rebuild their infrastructures after WW2

answer

True

question

Most duty is collected ad valorem which means

answer

it is based in the value of the import

question

Among freight often carried in the belly of scheduled international passenger airplanes are

answer

critical machine or computer parts and fresh produce like fish

question

An export management company earns its revenue through

answer

sales commission

STUDY

Balance Decision Making Economic Order Quantity Finance Operating Cash Flow Post Office Box Short Term Investment

Managerial Finance Test 3 139 terms

Marvel Brown

139 terms

Preview

Managerial Finance Test 3

question

What is not a valid reason for holding cash?

answer

To earn the highest return possible.

question

The problem with stretching out the maturity of marketable securities is that

answer

There is a greater possibility of loss.

question

Companies that are mostly influenced by seasonal sales have to make a choice between

answer

Seasonal production and an uneven workforce A stable workforce and a fluctuating workforce Level production and inventory buildup

question

What is not a factor influencing the selection of a marketable security?

answer

Float

question

The corporate sweep account is an account that

answer

allows companies to maintain zero balances in their checking accounts, with their excess cash moved to an interest earning account and lets companies write checks on zero balance accounts with the understanding that when the check is presented for payment, money will be moved from the interest earning account to the appropriate payment account.

question

Some of the services provided around the clock by SWIFT

answer

Trade finance transactions International payments between banks Foreign exchange

question

The \"Financial Futures Market\"

answer

Allows for the delivery of financial instruments at a future point in time.

question

The Economic Order Quantity

answer

Assumes that delivery times of each order are consistent.

question

Some analysts believe that the term structure of interest rates is determined by the behavior of various types of financial institutions. This theory is called the

answer

market segmentation theory.

question

Money Market Funds are

answer

accounts that allow small investors to participate in buying large denomination securities.

question

The inventory decision model provides what type of information?

answer

Optimal Order Size

question

The required compensating balance is usually computed as

answer

percentage of the customer's loans outstanding, or percentage of the bank's commitments toward future loans to the customer.

question

Ideally what type of assets should be financed with long term financing?

answer

Fixed assets and permanent current assets

question

The prime rate

answer

has been quite volatile during these past two decades, moving several percentage points in a twelve month period.

question

Commercial paper that is sold without going through a broker or dealer is known as

answer

direct paper.

question

Money Market Funds

answer

earn competitive market rates of return.

question

The cost of carrying inventory do not include

answer

ordering costs

question

What are some methods used for controlling pledged inventory?

answer

Public warehousing Blanket inventory liens Floor planning

question

The Truth in Lending Law is primarily designed to protect

answer

consumers.

question

What is considered to be the least liquid of current assets?

answer

Inventory

question

Web based supply chain management has many benefits EXCEPT

answer

it reduces the number of suppliers bidding for a company's business.

question

The use of cash budgeting procedures

answer

Illustrates fluctuating levels of current assets for a given production plan. Makes managing inventory easier under seasonal production. Helps the firm plan its current asset levels for a given production plan.

question

Commercial paper that is sold without the use of an actual paper certificate is known as

answer

book-entry paper.

question

The key to current asset planning is the ability of management to forecast sales accurately and then match production schedules with the sales forecast. (T/F)

answer

True

question

The successful financial manager is very interested in the term structure of interest rates, but is not concerned with the relative volatility or historical level of interest rates. (T/F)

answer

False

question

Heavy risk exposure due to short term borrowing can be compensated for by carrying illiquid assets. (T/F)

answer

False

question

Firms with predictable cash flow patterns should assume relatively low levels of risk. (T/F)

answer

False

question

Pressure to increase current asset buildup often results from

answer

rapidly expanding sales.

question

Working capital management is primarily concerned with the management and financing of

answer

current assets

question

The term permanent current assets implies

answer

some minimum level of current assets that are not self liquidating.

question

The concept of self liquidating assets implies that

answer

all the production will be sold, receivables collected, and bills paid over the time period specified.

question

Permanent current assets are not a factor in a managers decision making process when all current assets will be

answer

self-liquidating.

question

RFID chips have been used to

answer

track livestock track inventory at retailers track marathon runner's times

question

One advantage of level production is that

answer

manpower and equipment are used efficiently at lower costs.

question

Publishing companies are characterized by

answer

seasonal sales.

question

If a firm uses level production with seasonal sales

answer

As sales decline, inventory will increase.

question

Retail companies like Target and Limited Brands exhibit sales patterns that are most typically influenced by

answer

seasonality.

question

Retail companies like Target and Limited brands are more likely to have

answer

cyclical sales and more volatile earnings per share.

question

Assuming level production throughout the year, and assuming receivables are collected in two equal installments over the two months subsequent to the sales period, developing the related areas of the cash budget requires what step?

answer

Estimate monthly net cash flow and bank borrowing or repayments.

question

When actual sales are greater than forecasted sales

answer

Production schedules might have to be revised upward Accounts receivable will rise Inventory will decline

question

Normally, permanent current assets should be financed by

answer

long term funds

question

A conservatively financed firm would

answer

Use long term financing for permanent current assets, and a portion of the short term fluctuating assets, and use short term financing for all other short term assets.

question

Generally more use is made of short term financing because

answer

short term interest rates are generally lower than long term interest rates, and most firms do not have basic access to capital markets.

question

The term structure of interest rates

answer

Is an indication of investor's expectations about inflation and future interest rates Will be downward sloping if short term interest rates are higher than long term interest rates Will be upward sloping under normal conditions

question

The term structure of interest rates

answer

changes daily to reflect current competitive conditions in the money and capital market.

question

The term structure of interest rates is influenced by

answer

inflation the money supply Federal Reserve activities

question

The belief that investors require a higher return to entice them into holding long term securities is the view point of

answer

Liquidity Premium Theory

question

The term structure of interest rates

answer

is often referred to as the yield curve is usually constructed with U.S. government securities of varying maturities depicts the relative level of short and long term interest rates

question

Yield curve changes daily to reflect

answer

Changing conditions in the overall economy Changing conditions in the money and capital market New inflation expectations

question

U.S. government securities are used to construct yield curves because

answer

they are free of default risk and the large number of maturities form a continuous curve.

question

The theory of the term structure of interest rates, which suggests that long term interest rates are determined by the average of short term rates expected over the time that a long term bond is outstanding is the

answer

Expectations Hypothesis

question

A normal term structure of interest rates would depict

answer

long term rates higher than short term rates

question

A firm will usually increase the ratio of short term debt to long term debt when

answer

the term structure is inverted and expected to shift down

question

What yield curve would be characteristic during a period of high economic growth?

answer

Upward sloping

question

An inverted yield curve would suggest

answer

Interest rates are expected to fall

question

When the term structure of interest rates is downward sloping and interest rates are expected to decline the

answer

financial manager generally borrows short term.

question

During tight money periods

answer

short term rates are higher than long term rates

question

What technique allows explicit consideration of more than one possible outcome

answer

Expected Value

question

What is a reason for diminishing liquidity in modern corporations?

answer

Better utilization of cash via computers Increased use of point-of-sale terminals Just in time inventory programs

question

An aggressive risk orientated firm will

answer

borrow short term and carry low levels of liquidity

question

Which is not a condition under which a prudent manager would accept some risk in financing?

answer

Inventory is highly perishable

question

Risk exposure due to heavy short term borrowing can be compensated for by

answer

carrying highly liquid assests

question

What combination of asset structures and financing patterns is likely to create the least volatile earnings?

answer

Liquid assets and heavy long term borrowing

question

What combination of asset structures and financing patterns is likely to create the most volatile earnings?

answer

Illiquid assets and heavy short term borrowing

question

An aggressive working capital policy would have

answer

A high ratio of short-term debt to long-term sources of funds

question

When the yield curve is upward sloping, generally a financial manager should

answer

Utilize long term financing

question

When the yield curve is downward sloping, generally a financial manager should

answer

utilize short term financing

question

Cash flow does not rely on

answer

The monetary policy of the federal reserve

question

Cash flow relies on

answer

The payment patterns of customers The speed at which suppliers and creditors process checks The efficiency of the banking system

question

The difference between the amount of cash on the firm's books and the amount credited to it by its bank is

answer

float.

question

\"Float\" takes place because

answer

a lag exists between writing a check and clearing it through the banking system.

question

What is not a method for speeding up collections?

answer

Extended disbursement float

question

What are methods for speeding up collections?

answer

Lock box system Regional collection centers

question

The system whereby funds are moved between computer terminals without use of checks is

answer

Electronic funds transfer

question

How will widespread adoption of electronic funds transfer affect the use of \"Float\"?

answer

It will virtually eliminate it's use.

question

Automated clearing houses are commonly used by consumers to make direct payments for

answer

Insurance premiums Utility Bills Mortgage payments

question

One of the major cost savings for consumers using automated clearing houses are

answer

saving great amounts of money on postage the security of having the payments and deposits directly deposited or deducted from your account Saving time paying bills through check writing

question

What is not true about Automate Clearing Houses?

answer

Debits drawn on automated clearing houses cost less than half of the checks processed through financial institutions.

question

International cash management is more complex than domestic based cash management because

answer

Currency fluctuation risk Liquidity management issues Different banking systems

question

SWIFT's implementation of the \"smart card\" is expected to

answer

decrease the likelihood of electronic fraud.

question

International cash management systems are more complex than domestic cash management systems because

answer

liquidity management involving short term cash balances and deficits, has to be managed across international boundaries and time zones and is subject to the risk of currency fluctuations. Changing interest rates across countries

question

A multinational company may prefer to hold sizable cash balances in one currency rather than another because

answer

of high interest rates existing in one country and because one country's currency may be strong relative to the other.

question

Generally, the safest and most marketable instrument for short term investment is

answer

Treasury Bills

question

What security typically trades on a discount basis?

answer

Treasury Bills

question

A firm that wishes to minimize risk when investing idle cash would be LEAST likely to buy

answer

long-term corporate bonds

question

A banker's acceptance

answer

May be accepted by the bank for future payment. Can be traded in a relatively liquid market until maturity. Is a draft drawn on a bank and paid by the bank when presented to it.

question

Eurodollar certificates of deposit are

answer

used by banks to loan out funds to anyone seeking U.S. dollars

question

In comparison to securities issued by the U.S. government agencies like Federal Home Loan Bank

answer

yield slightly more than treasury securities

question

What security represents an unsecured promissory note issued by a corporation

answer

Commercial Paper

question

Characteristics of a money market mutual fund include:

answer

the purchase of shares by investors, the proceeds by which are reinvested into liquid short term securities

question

Characteristics of a money market deposit include:

answer

A lower risk than money market funds Insurance by federal agencies Generally a limit of three deposits or withdrawals per month

question

The three primary policy variables to consider when extending credit include:

answer

Collection policy Credit Standards Terms of trade

question

The most subjective and also significant segment of the 5 C's of credit for giving approval is

answer

Character

question

Dun and Bradstreet is best known for providing

answer

Credit scoring reports that rank a company's payment habits relative to its peer group

question

When developing a credit scoring report, many variables are considered. What best represents the major factors Dun and Bradstreet would examine?

answer

The financial statements, satisfactory or slow payment experiences, and negative public records (suits, liens, judgments, and bankruptcies).

question

What are qualitative measures for accounts receivable collection policies

answer

Aging of account receivables Ration of bad debts to credit sales Average collection period

question

Variables important to credit scoring models include

answer

Negative public records Age of company in years Facility ownership

question

Inventory is usually divided into what three basic categories

answer

Raw Material Work in progress Finished goods

question

For a given firm, holding all other factors constant, ordering costs per unit generally

answer

decline as average inventory increases

question

Use of the Economic Order Quantity

answer

Provides the lowest overall inventory costs

question

When using the economic order quantity model

answer

Costs are minimized when total carrying costs and total ordering costs are equal.

question

The amount of safety stock that a firm carries depends upon

answer

the predictability of inventory usage, and the time period necessary to fill inventory orders

question

A just in time inventory management program has what requirements?

answer

Quality production Minimizing inventory levels Close ties between suppliers, manufacturers, and customers

question

Cost savings from just in time inventory include

answer

greater productivity lower inventory financing costs reduced overhead expenses

question

Just in time ordering systems prevent

answer

stock outs

question

Methods of controlling receivables are

answer

using DBIS Offering a cash discount Reducing Net terms

question

Level production benefits are

answer

higher use of capacity maximum efficiency lower overtime usage

question

Carrying Costs are

answer

Interest expense Warehouse space Insurance premiums

question

What is generally the largest source of short term credit for small firms?

answer

Trade credit

question

Trade credit may used to finance a major part of a firm's working capital when

answer

the firm extends less liberal credit terms than the supplier

question

A large manufacturing firm has been selling on a 3/10 net 30 basis. The firm changes its credit to 2/20 net 90. What change might be expected on the balance sheet of its customers

answer

Increased payables and decreased bank loans

question

Large firms tend to be

answer

net suppliers of a trade credit

question

From a banker's point of view short term bank credit is an excellent way of financing

answer

seasonal bulges in inventory and receivables

question

Bank loans to business firms

answer

are usually short term in nature may require compensating balances are preferred by the banker to be self liquidating

question

Commercial bank term loans

answer

are offered to superior credit applicants

question

Recent problems facing the U.S. financial system were the result of what?

answer

A huge increase in the amount of mortgage backed securities being bundled up and sold in the markets. A huge drop in the value of mortgage backed securities. Government permitting commercial and investment banks to merge.

question

The London Inter Bank Offer Rate

answer

is an estimate of the interbank lending rate for London banks. has been lower than the U.S. prime rate for at least the last decade. competes with the U.S. prime rate for those companies with an international presence.

question

LIBOR is

answer

interest rate paid on eurodollar loans in the London market

question

Compensating Balances

answer

are used by banks as a substitute for charging service fees

question

A term loan is usually characterized by

answer

monthly or quarterly installment payments maturity of one to seven years a variable interest rate

question

In determining the cost of bank financing, and important factor is

answer

the effective rate

question

Commercial paper is very popular with firms because

answer

It can usually be issued below the prime rate

question

Commercial paper offers what advantages to the issuer?

answer

May be issued below the prime rate and requires no compensating balances

question

What is NOT a characteristic of commercial paper?

answer

It has one to two year maturity

question

What is not a true statement about commercial paper?

answer

Dealer paper is sold directly to the lender by a finance company

question

Multinational firms have found that they can lower borrowing costs

answer

by borrowing eurodollars at a rate lower than the U.S. prime rate and by borrowing foreign currencies through foreign subsidiaries at rates lower than the U.S. prime rate and then converting these foreign loans into dollars

question

Accounts receivable may be used as a source of financing by

answer

pledging the receivables as loan collateral selling securities backed by the receivables \"factoring\" the receivables to a finance company

question

What best describes the benefits to the borrower of selling asset-backed securities

answer

The borrower trade future cash flows for current cash flows and the asset backed security is likely to carry a high credit rating of AA or better.

question

What is associated with the recession of 07-09

answer

Commercial and investment banks were allowed to merge. Hundreds of bank failures occurred. Federal Reserve and Federal Deposit Insurance Corporation forced large banks at risk of collapse to be taken over by healthy banks.

question

The extent to which inventory financing may be used depends on the

answer

price stability of goods. perishability of goods. marketability of pledged goods.

question

What are methods for lenders to control pledged inventory?

answer

Warehousing Trust Receipts Blanket Inventory Liens

question

What method of controlling pledged inventory provides the greatest degree of security to the lender?

answer

Warehousing

question

Hedging refers to

answer

transaction that reduces risk exposure

question

Firms exposed to the risks of interest rate changes may reduce that risk by

answer

hedging in the financial future markets

question

If a firm has invested in corporate bonds, it may engage in financial futures contract in order to protect itself from

answer

rising interest rates.

question

what is NOT evident in a credit crunch?

answer

a decrease in interest rates occur

question

What is NOT a benefit of commercial paper to a corporation?

answer

It is less risky.

question

What is NOT a reason why a company may choose to pledge accounts receivables?

answer

A lower interest rate

question

What are reasons why a company may choose to pledge accounts receivables?

answer

It provides another source of financing for companies with lower credit ratings. The borrowing capacity fluctuates with accounts receivable.

STUDY

Economic Order Quantity Fixed Order Quantity Human Resource Management Price Per Unit

Chapter 11 (4) OPMA – Flashcards 107 terms

Jay Barber

107 terms

Preview

Chapter 11 (4) OPMA – Flashcards

question

Inventory is defined as the stock of any item or resource used in an organization.

answer

True

question

An inventory system is a set of policies and controls that monitors levels of inventory and determines what levels should be maintained, when stock should be replenished, and how large orders should be.

answer

True

question

One of the basic purposes of inventory analysis in manufacturing and stockkeeping services is to specify when items should be ordered.

answer

True

question

One of the basic purposes of inventory analysis in manufacturing and stockkeeping services is to determine the level of quality to specify.

answer

False The basic purpose of inventory analysis in manufacturing and stockkeeping services is to specify (1) when items should be ordered and (2) how large the order should be.

question

One of the basic purposes of inventory analysis in manufacturing and stockkeeping services is to determine how large the orders to vendors should be.

answer

True

question

In inventory models, high holding costs tend to favor high inventory levels.

answer

False Holding (or carrying) costs. This broad category includes the costs for storage facilities, handling, insurance, pilferage, breakage, obsolescence, depreciation, taxes, and the opportunity cost of capital. Obviously, high holding costs tend to favor low inventory levels and frequent replenishment.

question

In inventory models, high holding costs tend to favor low inventory levels and frequent replenishment.

answer

True

question

If the cost to change from producing one product to producing another were zero the lot size would be very small.

answer

True

question

Shortage costs are precise and easy to measure.

answer

False When the stock of an item is depleted, an order for that item must either wait until the stock is replenished or be canceled. There is a trade-off between carrying stock to satisfy demand and the costs resulting from stockout. This balance is sometimes difficult to obtain, because it may not be possible to estimate lost profits, the effects of lost customers, or lateness penalties.

question

Dependent demand inventory levels are usually managed by calculations using calculus-driven, cost-minimizing models.

answer

False Independent demand, the need for any one item is a direct result of the need for some other item, usually a higher-level item of which it is part.

question

The fixed-time period inventory system has a smaller average inventory than the fixed-order quantity system because it must also protect against stockouts during the review period when inventory is checked.

answer

False Fixed-time period model has a larger average inventory because it must also protect against stockout during the review period, T; the fixed-order quantity model has no review period.

question

The fixed-order quantity inventory model favors less expensive items because average inventory is lower.

answer

False The fixed-order quantity model favors more expensive items because average inventory is lower.

question

The fixed-order quantity inventory model is more appropriate for important items such as critical repair parts because there is closer monitoring and therefore quicker response to a potential stockout.

answer

True

question

The fixed-order quantity inventory model requires more time to maintain because every addition or withdrawal is logged.

answer

True

question

Fixed-order quantity inventory models are "event triggered."

answer

True

question

Fixed-order quantity inventory models are "time triggered."

answer

False The basic distinction is that fixed-order quantity models are "event triggered" and fixed-time period models are "time triggered."

question

Fixed-time period inventory models are "event triggered."

answer

False The basic distinction is that fixed-order quantity models are "event triggered" and fixed-time period models are "time triggered."

question

Fixed-time period inventory models are "time triggered."

answer

True

question

Fixed-order quantity inventory systems determine the reorder point, R and the order quantity, Q values.

answer

True

question

The computation of a firm's inventory position is found by taking the inventory on hand and adding it to the on-order inventory, and then subtracting back-ordered inventory.

answer

True

question

Using the probability approach we assume that the demand over a period of time is normally distributed.

answer

True

question

Safety stock can be defined as the amount of inventory carried in addition to the expected demand.

answer

True

question

If demand for an item is normally distributed we plan for demand to be twice the average demand and carry 2 standard deviations worth of safety stock inventory.

answer

False Companies using the probability approach generally set the probability of not stocking out at 95 percent. This means we would carry about 1.64 standard deviations of safety stock.

question

Safety stock can be computed when using the fixed-order quantity inventory model by multiplying a "z" value representing the number of standard deviations to achieve a service level or probability by the standard deviation of periodic demand.

answer

True

question

The key difference between a fixed-order quantity inventory model, where demand is known and one where demand is uncertain is in computing the reorder point.

answer

True

question

Fixed-time period inventory models generate order quantities that vary from time period to time period, depending on the usage rate.

answer

True

question

Fixed-order quantity systems assume a random depletion of inventory, with less than an immediate order when a reorder point is reached.

answer

False The fixed-order quantity system focuses on order quantities and reorder points. Procedurally, each time a unit is taken out of stock, the withdrawal is logged and the amount remaining in inventory is immediately compared to the reorder point. If it has dropped to this point, an order for Q items is placed. If it has not, the system remains in an idle state until the next withdrawal.

question

The standard fixed-time period model assumes that inventory is never counted but determined by EOQ measures.

answer

False Fixed-time period models generate order quantities that vary from period to period, depending on the usage rates. The standard fixed-time period models assume that inventory is counted only at the time specified for review

question

Safety stock is not necessary in any fixed-time period system.

answer

False Fixed-time period models generate order quantities that vary from period to period, depending on the usage rates. These generally require a higher level of safety stock than a fixed-order quantity system.

question

In the fixed-time period model it is necessary to determine the inventory currently on hand to calculate the size of the order to place with a vendor.

answer

True

question

Some inventory situations involve placing orders to cover only one demand period or to cover short-lived items at frequent intervals.

answer

True

question

The optimal stocking decision in inventory management, when using marginal analysis, occurs at the point where the benefits derived from carrying the next unit are more than the costs for that unit.

answer

False The optimal stocking level, using marginal analysis, occurs at the point where the expected benefits derived from carrying the next unit are less than the expected costs for that unit.

question

When stocked items are sold, the optimal inventory decision using marginal analysis is to stock that quantity where the probable profit from the sale or use of the last unit is equal to or greater than the probable losses if the last unit remains unsold.

answer

True

question

Cycle counting is a physical inventory-taking technique in which inventory is counted on a frequent basis rather than once or twice a year.

answer

True

question

The "sawtooth effect," named after turn-around artist Al "chainsaw" Dunlap, is the severe reduction of inventory and service levels that occurs when a firm has gone through a hostile takeover.

answer

False The "sawtooth effect" relating Q and R in Exhibit 11.5 shows that when the inventory position drops to point R, a reorder is placed.

question

The "sawtooth effect," is named after the jagged shape of the graph of inventory levels over time.

answer

True

question

Price-break models deal with the fact that the selling price of an item varies with the order size.

answer

True

question

Price-break models deal with the fact that the selling price of an item generally increases as the order size increases.

answer

False Price-break models deal with the fact that, generally, the selling price of an item varies with the order size.

question

Price-break models deal with discrete or step changes in price as order size changes rather than a per-unit change.

answer

True

question

In a price break model of lot sizing, to find the lowest-cost order quantity, it is sometimes necessary to calculate the economic order quantity for each possible price.

answer

True

question

In a price break model of lot sizing, to find the lowest-cost order quantity, it is sometimes necessary to calculate the economic order quantity for each possible price and to check to see whether the lowest cost quantity is feasible.

answer

True

question

In a price break model of lot sizing the lowest cost quantity is always feasible.

answer

False Step 1. Sort the prices from lowest to highest and then, beginning with the lowest price, calculate the economic order quantity for each price level until a feasible economic order quantity is found. By feasible, we mean that the price is in the correct corresponding range. Step 2. If the first feasible economic order quantity is for the lowest price, this quantity is best and you are finished. Otherwise, calculate the total cost for the first feasible economic order quantity (you did these from lowest to highest price) and also calculate the total cost at each price break lower than the price associated with the first feasible economic order quantity. This is the lowest order quantity at which you can take advantage of the price break. The optimal Q is the one with the lowest cost.

question

One of the drivers of the direct-to-store (direct distribution) approach is the upstream migration of value-added logistics services.

answer

True

question

One of the drivers of the direct-to-store (direct distribution) approach is the increase in global sourcing.

answer

True

question

One of the drivers of the direct-to-store (direct distribution) approach is the decrease in trucking industry regulation.

answer

False What accounts for the emergence of the direct-to-store model? Global sourcing and the upstream migration of value-added logistics services are certainly primary drivers.

question

You should visualize inventory as stacks of money sitting on forklifts, on shelves, and in trucks and planes while in transit.

answer

True

question

One of the daily, delicate balancing acts that Logistics managers have to perform involves the trade-off between transportation costs and fulfillment speed.

answer

True

question

One of the daily, delicate balancing acts that Logistics managers have to perform involves the trade-off between customer satisfaction and cost to serve.

answer

True

question

One of the daily, delicate balancing acts that Logistics managers have to perform involves the trade-off between inventory costs and the cost of stock-outs.

answer

True

question

The average cost of inventory in the United States is 20 to 25 percent of its value.

answer

False The average cost of inventory in the United States is 30 to 35 percent of its value.

question

Savings from reduced inventory results in increased profit.

answer

True

question

The costs associated with reduced inventory results in lower profits.

answer

False Savings from reduced inventory results in increased profit.

question

Which of the following is not one of the categories of manufacturing inventory? A. Raw materials B. Finished products C. Component parts D. Just-in-time E. Supplies

answer

D. Just-in-time

question

Which of the following is one of the categories of manufacturing inventory? A. Economic Order Inventory B. Work-in-process C. Quality units D. JIT Inventory E. Re-order point

answer

B. Work-in-process

question

Firms keep supplies of inventory for which of the following reasons? A. To maintain dependence of operations B. To provide a feeling of security for the workforce C. To meet variation in product demand D. To hedge against wage increases E. In case the supplier changes the design

answer

C. To meet variation in product demand

question

Which of the following is not a reason to carry inventory? A. To provide a safeguard for variation in raw material delivery time B. To take advantage of economic purchase-order size C. To maintain independence of operations D. To meet variation in product demand E. To keep the stock out of the hands of competitors

answer

E. To keep the stock out of the hands of competitors

question

When developing inventory cost models, which of the following are not included as costs to place an order? A. Phone calls B. Taxes C. Clerical D. Calculating quantity to order E. Postage

answer

B. Taxes

question

When material is ordered from a vendor, which of the following is not a reason for delays in the order arriving on time? A. Normal variation in shipping time B. A shortage of material at the vendor's plant causing backlogs C. An unexpected strike at the vendor's plant D. A lost order E. Redundant ordering systems

answer

E. Redundant ordering systems When material is ordered from a vendor, delays can occur for a variety of reasons: a normal variation in shipping time, a shortage of material at the vendor's plant causing backlogs, an unexpected strike at the vendor's plant or at one of the shipping companies, a lost order, or a shipment of incorrect or defective material.

question

Which of the following is not included as an inventory holding cost? A. Annualized cost of materials B. Handling C. Insurance D. Pilferage E. Storage facilities

answer

A. Annualized cost of materials Holding costs include the costs for storage facilities, handling, insurance, pilferage, breakage, obsolescence, depreciation, taxes, and the opportunity cost of capital.

question

Which of the following is usually included as an inventory holding cost? A. Order placing B. Breakage C. Typing up an order D. Quantity discounts E. Annualized cost of materials

answer

B. Breakage Holding costs include the costs for storage facilities, handling, insurance, pilferage, breakage, obsolescence, depreciation, taxes, and the opportunity cost of capital.

question

In making any decision that affects inventory size, which of the following costs do not need to be considered? A. Holding costs B. Setup costs C. Ordering costs D. Fixed costs E. Shortage costs

answer

D. Fixed costs In making any decision that affects inventory size, the following costs must be considered. 1. Holding (or carrying) costs. 2. Setup (or production change) costs. 3. Ordering costs. 4. Shortage costs.

question

Which of the following are fixed-order quantity inventory models? A. Economic order quantity model B. The ABC model C. Periodic replenishment model D. Cycle counting model E. P model

answer

A. Economic order quantity model

question

Which of the following are fixed-time period inventory models? A. The EOQ model B. The least cost method C. The Q model D. Periodic system model E. Just-in-time model

answer

D. Periodic system model

question

Which of the following is a perpetual system for inventory management? A. Fixed-time period B. Fixed-order quantity C. P model D. First-in-first-out E. The wheel of inventory

answer

B. Fixed-order quantity The fixed-order quantity model is a perpetual system, which requires that every time a withdrawal from inventory or an addition to inventory is made, records must be updated to reflect whether the reorder point has been reached.

question

Which of the following is an assumption of the basic fixed-order quantity inventory model? A. Lead times are averaged B. Ordering costs are variable C. Price per unit of product is constant D. Back orders are allowed E. Stock-out costs are high

answer

C. Price per unit of product is constant These assumptions are unrealistic, but they represent a starting point and allow us to use a simple example: 1. Demand for the product is constant and uniform throughout the period. 2. Lead time (time from ordering to receipt) is constant. 3. Price per unit of product is constant. 4. Inventory holding cost is based on average inventory. 5. Ordering or setup costs are constant. 6. All demands for the product will be satisfied. (No backorders are allowed.)

question

Which of the following is not an assumption of the basic fixed-order quantity inventory model? A. Ordering or setup costs are constant B. Inventory holding cost is based on average inventory C. Diminishing returns to scale of holding inventory D. Lead time is constant E. Demand for the product is uniform throughout the period

answer

C. Diminishing returns to scale of holding inventory These assumptions are unrealistic, but they represent a starting point and allow us to use a simple example: 1. Demand for the product is constant and uniform throughout the period. 2. Lead time (time from ordering to receipt) is constant. 3. Price per unit of product is constant. 4. Inventory holding cost is based on average inventory. 5. Ordering or setup costs are constant. 6. All demands for the product will be satisfied. (No backorders are allowed.)

question

Which of the following is the symbol used in the textbook for the cost of placing an order in the fixed-order quantity inventory model? A. C B. TC C. H D. Q E. S

answer

E. S S = Setup cost or cost of placing an order

question

Which of the following is the set of all cost components that make up the fixed-order quantity total annual cost (TC) function? A. Annual purchasing cost, annual ordering cost, fixed cost B. Annual holding cost, annual ordering cost, unit cost C. Annual holding cost, annual ordering cost, annual purchasing cost D. Annual lead time cost, annual holding cost, annual purchasing cost E. Annual unit cost, annual set up cost, annual purchasing cost

answer

C. Annual holding cost, annual ordering cost, annual purchasing cost Total Annual Cost = Annual Purchase Cost + Annual Ordering Cost + Annual Holding Cost.

question

Assuming no safety stock, what is the re-order point (R) given an average daily demand of 50 units, a lead time of 10 days and 625 units on hand? A. 550 B. 500 C. 715 D. 450 E. 475

answer

B. 500 Fifty (50) times ten (10) equals 500.

question

Assuming no safety stock, what is the reorder point (R) given an average daily demand of 78 units and a lead time of 3 days? A. 421 B. 234 C. 78 D. 26 E. 312

answer

B. 234 78 times 3 = 234

question

If annual demand is 12,000 units, the ordering cost is $6 per order and the holding cost is $2.50 per unit per year, which of the following is the optimal order quantity using the fixed-order quantity model? A. 576 B. 240 C. 120.4 D. 60.56 E. 56.03

answer

B. 240 240 = Square root of (2 x 12,000 x 6/2.5)

question

If annual demand is 50,000 units, the ordering cost is $25 per order and the holding cost is $5 per unit per year, which of the following is the optimal order quantity using the fixed-order quantity model? A. 909 B. 707 C. 634 D. 500 E. 141

answer

B. 707 Q = 707.1 = Square root of (2 x 50,000 x 25/5)

question

If annual demand is 35,000 units, the ordering cost is $50 per order and the holding cost is $0.65 per unit per year, which of the following is the optimal order quantity using the fixed-order quantity model? A. 5,060 B. 2,320 C. 2,133 D. 2,004 E. 1,866

answer

B. 2,320 Q = 2,320.5 = Square root of (2 x 35,000 x 50/0.65)

question

Using the fixed-order quantity model, which of the following is the total ordering cost of inventory given an annual demand of 36,000 units, a cost per order of $80 and a holding cost per unit per year of $4? A. $849 B. $1,200 C. $1,889 D. $2,267 E. $2,400

answer

E. $2,400 1,200 = Square root of (2 x 36,000 x 80/4). Number of orders per year = 36,000/1,200 = 30 x $80 = $2,400

question

A company is planning for its financing needs and uses the basic fixed-order quantity inventory model. Which of the following is the total cost (TC) of the inventory given an annual demand of 10,000, setup cost of $32, a holding cost per unit per year of $4, an EOQ of 400 units, and a cost per unit of inventory of $150? A. $1,501,600 B. $1,498,200 C. $500,687 D. $499,313 E. None of the above

answer

A. $1,501,600 Q = 400. Average Inventory = Q/2 = 200. Holding cost/year = $4. Thus, annual holding cost = $800. Annual set-up cost = 10,000/400 = 25 x $32 = 800. Demand x cost per unit = 10,000 x $150 = 1,500,000. Hence, TC = $1,500,000 + 800 + 800 = $1,501,600.

question

A company has recorded the last five days of daily demand on their only product. Those values are 120, 125, 124, 128, and 133. The time from when an order is placed to when it arrives at the company from its vendor is 5 days. Assuming the basic fixed-order quantity inventory model fits this situation and no safety stock is needed, which of the following is the reorder point (R)? A. 120 B. 126 C. 630 D. 950 E. 1,200

answer

C. 630 Average demand is 120 + 125 + 124 + 128 + 133/5 = 126. Lead time = 5 days so the reorder point is 126 x 5 = 630.

question

A company has recorded the last six days of daily demand on a single product they sell. Those values are 37, 115, 93, 112, 73, and 110. The time from when an order is placed to when it arrives at the company from its vendor is 3 days. Assuming the basic fixed-order quantity inventory model fits this situation and no safety stock is needed, which of the following is the reorder point (R)? A. 540 B. 270 C. 115 D. 90 E. 60

answer

B. 270 Average demand is 37 + 115 + 93 + 112 + 73 + 110/6 = 90. Lead time = 3 days so the reorder point is 90 x 3 = 270.

question

Using the probability approach to determine an inventory safety stock and wanting to be 95 percent sure of covering inventory demand, which of the following is the number of standard deviations necessary to have the 95 percent service probability assured? A. 1.28 B. 1.64 C. 1.96 D. 2.00 E. 2.18

answer

B. 1.64 Companies using this approach generally set the probability of not stocking out at 95 percent. This means we would carry about 1.64 standard deviations of safety stock,

question

To take into consideration demand uncertainty in reorder point (R) calculations, what do we add to the product of the average daily demand and lead time in days when calculating the value of R? A. The product of average daily demand times a standard deviation of lead time B. A "z" value times the lead time in days C. The standard deviation of vendor lead time times the standard deviation of demand D. The product of lead time in days times the standard deviation of lead time E. The product of the standard deviation of demand variability and a "z" score relating to a specific service probability.

answer

E. The product of the standard deviation of demand variability and a "z" score relating to a specific service probability.

question

In order to determine the standard deviation of usage during lead time in the reorder point formula for a fixed-order quantity inventory model which of the following must be computed first? A. Standard deviation of daily demand B. Number of standard deviations for a specific service probability C. Stockout cost D. Economic order quantity E. Safety stock level

answer

A. Standard deviation of daily demand

question

If it takes a supplier four days to deliver an order once it has been placed and the standard deviation of daily demand is 10, which of the following is the standard deviation of usage during lead time? A. 10 B. 20 C. 40 D. 100 E. 400

answer

B. 20 The standard deviation of usage during lead time is equal to the square root of the sums of the variances of the number of days of lead time. Since variance equals standard deviation squared, the standard deviation of usage during lead time is the square root of 4(10x10) = square root of 400 = 20.

question

If it takes a supplier 25 days to deliver an order once it has been placed and the standard deviation of daily demand is 20, which of the following is the standard deviation of usage during lead time? A. 50 B. 100 C. 400 D. 1,000 E. 1,600

answer

B. 100 the standard deviation of usage during lead time will be the square root of (25 x (20 x 20)) = square root of 10,000 = 100

question

If it takes a supplier two days to deliver an order once it has been placed and the daily demand for three days has been 120, 124, and 125, which of the following is the standard deviation of usage during lead time? A. About 2.16 B. About 3.06 C. About 4.66 D. About 5.34 E. About 9.30

answer

B. About 3.06 The standard deviation (Equation 11.6) of daily demand = Square root of (14/3) = 2.1602. This number squared is 4.6667. The square root of (2 (days) times 4.6667) = the square root of 9.3333 or 3.055.

question

A company wants to determine its reorder point (R). Demand is variable and they want to build a safety stock into R. If the average daily demand is 12, the lead time is 5 days, the desired "z" value is 1.96, and the standard deviation of usage during lead time is 3, which of the following is the desired value of R? A. About 6 B. About 16 C. About 61 D. About 66 E. About 79

answer

D. About 66 (average daily demand times number of days of lead time) plus (standard deviation during lead time) times (desired Z score) = (12 x 5) + (3 x 1.96) = 60 + 5.88 = 65.88 = 66 units

question

A company wants to determine its reorder point (R). Demand is variable and they want to build a safety stock into R. The company wants to have a service probability coverage of 95 percent. If average daily demand is 8, lead time is 3 days, and the standard deviation of usage during lead time is 2, which of the following is the desired value of R? A. About 17.9 B. About 19.7 C. About 24.0 D. About 27.3 E. About 31.2

answer

D. About 27.3 Desired z score for service probability coverage of 95% = 1.64. Equation 11.5 is (average daily demand times number of days of lead time) plus (standard deviation during lead time) times (desired z score) = (8 x 3) + (2 x 1.64) = 24 + 3.28 = 27.28 = about 27.3 units

question

Which of the following is not necessary to compute the order quantity using the fixed-time period model with safety stock? A. Forecast average daily demand B. Safety stock C. Inventory currently on hand D. Ordering cost E. Lead time in days

answer

D. Ordering cost It requires: 1. The number of days between reviews 2. Lead time in days (time between placing an order and receiving it) 3. Forecast average daily demand 4. Number of standard deviations for a specified service probability 5. Standard deviation of demand over the review and lead time 6. Current inventory level (includes items on order)

question

Using the fixed-time period inventory model, and given an average daily demand of 200 units, 4 days between inventory reviews, 5 days for lead time, 120 units of inventory on hand, a "z" of 1.96, and a standard deviation of demand over the review and lead time of 3 units, which of the following is the order quantity? A. About 1,086 B. About 1,686 C. About 1,806 D. About 2,206 E. About 2,686

answer

B. About 1,686 q = (200 x (5 + 4) + 1.96 x 3) - 120 = 1,800 + 5.88 - 120 = 1,685.88 = about 1,686

question

Using the fixed-time period inventory model, and given an average daily demand of 75 units, 10 days between inventory reviews, 2 days for lead time, 50 units of inventory on hand, a service probability of 95 percent, and a standard deviation of demand over the review and lead time of 8 units, which of the following is the order quantity? A. 863 B. 948 C. 1,044 D. 1,178 E. 4,510

answer

A. 863 q = 75 x (10 + 2) + (1.64 x 8) - 50 = 900 + 13.12 - 50 = 863.12 = 863

question

Using the fixed-time period inventory model, and given an average daily demand of 15 units, 3 days between inventory reviews, 1 day for lead time, 30 units of inventory on hand, a service probability of 98 percent, and a standard deviation of daily demand is 3 units, which of the following is the order quantity? A. About 30.4 B. About 36.3 C. About 42.3 D. About 56.8 E. About 59.8

answer

C. About 42.3 q = 15 x (3 + 1) + (2.05 x 6) - 30 = 60 + 12.3 - 30 = 42.3

question

You would like to use the fixed-time period inventory model to compute the desired order quantity for a company. You know that vendor lead time is 5 days and the number of days between reviews is 7. Which of the following is the standard deviation of demand over the review and lead time if the standard deviation of daily demand is 8? A. About 27.7 B. About 32.8 C. About 35.8 D. About 39.9 E. About 45.0

answer

A. About 27.7 The standard deviation of demand over the 12 days of time between reviews and lead time is the square root of (12 x 64) = 27.71

question

You would like to use the fixed-time period inventory model to compute the desired order quantity for a company. You know that vendor lead time is 10 days and the number of days between reviews is 15. Which of the following is the standard deviation of demand over the review and lead time period if the standard deviation of daily demand is 10? A. 25 B. 40 C. 50 D. 73 E. 100

answer

C. 50 the standard deviation of demand over the 25 days of time between reviews and lead time is the square root of (25 x 100) = 50

question

If a vendor has correctly used marginal analysis to select their stock levels for the day (as in the newsperson problem), and the profit resulting from the last unit being sold (Cu) is $0.90 and the loss resulting from that unit if it is not sold (Co) is $0.50, which of the following is the probability of the last unit being sold? A. Greater than 0.357 B. Greater than 0.400 C. Greater than 0.556 D. Greater than 0.678 E. None of the above

answer

A. Greater than 0.357 P < = Cu/(Cu + Co) = 0.90/1.40 = 0.643. Since P is the probability that the unit will not be sold and 1 - P is the probability of it being sold, the answer to this question is 1 - 0.643 or 0.357.

question

If a vendor has correctly used marginal analysis to select their stock levels for the day (as in the newsperson problem), and the profit resulting from the last unit being sold (Cu) is $120 and the loss resulting from that unit if it is not sold (Co) is $360, which of the following is the probability of the last unit being sold? A. Greater than 0.90 B. Greater than 0.85 C. Greater than 0.75 D. Greater than 0.25 E. None of the above

answer

C. Greater than 0.75 P < = Cu/(Cu + Co) = 120/480 = 0.25. Since P is the probability that the unit will not be sold and 1 - P is the probability of it being sold, the answer to this question is 1 - 0.25 or 0.75

question

The Pareto principle is best applied to which of the following inventory systems? A. EOQ B. Fixed-time period C. ABC classification D. Fixed-order quantity E. Single-period ordering system

answer

C. ABC classification

question

Which of the following are the recommended percentage groupings of the ABC classifications of the dollar volume of products? A. A items get 15%, B items get 35%, and C items get 50% B. A items get 15%, B items get 45%, and C items get 40% C. A items get 25%, B items get 35%, and C items get 40% D. A items get 25%, B items get 15%, and C items get 60% E. A items get 20%, B items get 30%, and C items get 50%

answer

A. A items get 15%, B items get 35%, and C items get 50% The ABC approach divides this list into three groupings by value: A items constitute roughly the top 15 percent of the items, B items the next 35 percent, and C items the last 50 percent.

question

Using the ABC classification system for inventory, which of the following is a true statement? A. The "C" items are of moderate dollar volume B. You should allocate about 50 % of the dollar volume to "B" items C. The "A" items are of low dollar volume D. The "A" items are of high dollar volume E. Inexpensive and low usage items are classified as "C" no matter how critical

answer

D. The "A" items are of high dollar volume The ABC classification scheme divides inventory items into three groupings: high dollar volume (A), moderate dollar volume (B), and low dollar volume (C).

question

Which of the following values for "z" should we use in as safety stock calculation if we want a service probability of 98%? A. 1.64 B. 1.96 C. 2.05 D. 2.30 E. None of the above

answer

C. 2.05 Using the Excel function NORMSINV, the z score for a 98% service probability is 2.05.

question

Computer inventory systems are often programmed to produce a cycle count notice in which of the following case? A. When the record shows a near maximum balance on hand B. When the record shows positive balance but a backorder was written C. When quality problems have been discovered with the item D. When the item has become obsolete E. When the item has been misplaced in the stockroom

answer

B. When the record shows positive balance but a backorder was written The computer can be programmed to produce a cycle count notice in the following cases: 1. When the record shows a low or zero balance on hand. 2. When the record shows a positive balance but a backorder was written 3. After some specified level of activity. 4. To signal a review based on the importance of the item (as in the ABC system)

question

What is the term for there being no relationship between demands for various items?

answer

Independent demand In independent demand, the demands for various items are unrelated to each other.

question

Assuming no safety stock, what is the reorder point (R) given an average daily demand of 100 units and a lead time of 5 days?

answer

500 Reorder point = Average daily demand x Lead time in days = 100 x 5 = 500

question

If annual demand is 8,000 units, the ordering cost is $20 per order and the holding cost is $12.50 per unit per year, what is the optimal order quantity using the fixed-order quantity inventory model?

answer

160 Q = square root of ((2 x demand x order cost)/holding cost) = Square root ((2 x 8,000 x 20)/12.50) = Square root (25,600) = 160

question

Using the fixed-time period inventory model, and given an average daily demand of 300 units, 4 days between inventory reviews, 5 days for lead time, 1,200 units of inventory on hand, a "z" of 1.96, and a standard deviation of demand over the review and lead time of 12 units, what quantity should be ordered?

answer

1,525 q = (300 x (5 + 4) + 1.96 x 12) - 1200 = 2,700 + 23.52 - 1200 = 1,524.52 = about 1,525

question

Using the fixed-order quantity model, what is the total ordering cost of inventory given an annual demand of 36,000 units, a cost per order of $40 and a holding cost per unit per year of $45?

answer

$5,692 Q = square root of ((2 x demand x order cost)/holding cost) = Square root ((2 x 36,000 x 40)/45) = Square root (64,000) = 252.98. Dividing annual demand by Q, 36,000/252.98 = 142.3 orders per year x $40 per order = $5,692 ordering cost per year.

question

If it takes a supplier 10 days to deliver an order once it has been placed and the standard deviation of daily demand is 14, what is the standard deviation of usage during lead time?

answer

44.27 the answer is the square root of the sum of the variances which is the square root of 10 x (14 squared) or the square root of 1960 or 44.27.

question

What are the five purposes of inventory?

answer

All firms keep a supply of inventory for the following reasons: 1. To maintain independence of operations 2. To meet variation in product demand. 3. To allow flexibility in production scheduling. 4. To provide a safeguard for variation in raw material delivery time. 5. To take advantage of economic purchase order size.

question

In making any decision that affects the size of inventory, what are the four categories of cost that must be considered?

answer

In making any decision that affects inventory size, the following costs must be considered. 1. Holding (or carrying) costs. 2. Setup (or production change) costs. 3. Ordering costs. 4. Shortage costs.

question

What is the name of a physical inventory-taking technique that focuses only on certain items and counts more often than once or twice a year?

answer

Cycle counting is a physical inventory-taking technique in which inventory is counted frequently rather than once or twice a year

STUDY

Business Management Economic Order Quantity Operations Management Perpetual Inventory System

ISDS 3115 chapter 12 – Flashcards 41 terms

Karlie Mack

41 terms

Preview

ISDS 3115 chapter 12 – Flashcards

question

True

answer

True or False: The reorder point is the inventory level at which action is taken to replenish the stocked item.

question

B) annual dollar volume

answer

ABC analysis divides on-hand inventory into three classes, generally based upon which of the following? A) annual demand B) annual dollar volume C) item quality D) unit price E) the number of units on hand

question

timing of orders and order quantity

answer

The two most basic inventory questions answered by the typical inventory model are:

question

B) If annual demand were to double, the EOQ would also double

answer

Which of the following statements about the basic EOQ model is FALSE? A) If annual demand were to double, the number of order per year would increase B) If annual demand were to double, the EOQ would also double C) If the ordering cost were to increase, the EOQ would rise D) If the setup cost were to decrease, the EOQ would fall. E) All of the above statements are true.

question

pilferage, scrap, and obsolescence

answer

Which category of inventory holding costs has a much higher percentage than average for rapid-change industries such as PCs and cell phones?

question

since there is no count of inventory during the review period, a stockout is possible

answer

A disadvantage of the fixed-period inventory system is that:

question

fixed quantity; fixed period

answer

Q is to _______ systems as P is to _________ systems.

question

True

answer

True or False: Service level is the complement of the probability of a stockout.

question

D) to minimize holding costs

answer

Which of the following would NOT generally be a motive for a firm to hold inventories? A) to decouple various parts of the production process B) to hedge against inflation C) To take advantage of quantity discounts D) To minimize holding costs

question

A) Production and use can occur simultaneously

answer

Which of the following is NOT an assumption of the economic order quantity model shown below? Q* = SQRT(2DS/H) A) Production and use can occur simultaneously B) The only variable costs are setup cost and holding (or carrying cost) C) Quantity discounts are not possible D) Demand is known, constant, and independent E) Lead time is known and constant

question

E) All of the above are true

answer

Which of the following statements regarding the reorder point is TRUE? A) The reorder point is that quantity that triggers an action to restock an item B) there is a reorder point even if lead time and demand during lead time are constant C) A shorter lead time implies a smaller reorder point D) The reorder point is larger than d x L if safety stock is present E) All of the above are true

question

C) Perpetual inventory system

answer

Which of the following is a requirement of Q systems? A) Constant order spacing B) variable lead time C) Perpetual inventory system D) constant demand E) All of the above

question

E) All of the above are functions of inventory

answer

Which of the following is a function of inventory? A) to hedge against inflation B) to take advantage of quantity discounts C) to decouple various parts of the production process D) to provide a selection of goods for anticipated customer demand and to separate the firm from fluctuations in that demand E) All of the above are functions of inventory

question

D) It relaxes the assumption that all the order quantity is received at one time

answer

Which of the following statements regarding the production order quantity model is TRUE? A) it relaxes the assumption that the demand rate is constant B) It applies only to items produced in the firm's own production departments C) It minimizes inventory D) It relaxes the assumption that all the order quantity is received at one time E) It minimizes the total production costs

question

True

answer

True or False: In the quantity discount model, it is possible to have a cost-minimizing solution where annual ordering costs do not equal annual carrying costs.

question

B) ABC analysis is based on the presumption that all items must be tightly controlled to produce important cost savings

answer

Which of the following statements about ABC analysis is FALSE? A) In ABC analysis, forecasting methods for "C" items may be less sophisticated than for "A" items B) ABC analysis is based on the presumption that all items must be tightly controlled to produce important cost savings C) In ABC analysis, "A" items should have tighter physical inventory control than "B" or "C" items have. D) ABC analysis is based on the presumption that controlling the few most important items produces the vast majority of inventory savings E) Criteria other than annual dollar volume, such as high holding cost or delivery problems, can determine item classification in ABC analysis

question

control the likelihood of a stockout due to variable demand and/or lead time

answer

The purpose of safety stock is to:

question

E) B and D

answer

Service level is: A) something that should be minimized in retail B) the probability of not stocking out C) the probability of stocking out D) calculated as the cost of a shortage divided by (the cost of shortage + the cost of overage) for single-period models E) B and D

question

A) Effective control of all goods leaving the facility is one applicable technique

answer

Which of the following statements regarding control of service inventories is TRUE? A) Effective control of all goods leaving the facility is one applicable technique B) Service inventory needs no safety stock, because there's no such thing as a service stockout C) Service inventory has carrying costs but not setup costs D) Good personnel selection, training, and discipline are easy E) Service inventory is a fictional concept, because services are intangible

question

True

answer

True or False: The fixed-period inventory model can have a stockout during the review period as well as during the lead time, which is why fixed-period systems require more safety stock than fixed-quantity systems.

question

False

answer

True or False: Safety stock in inventory systems depends only on the average demand during the lead time.

question

is one-half of the economic order quantity

answer

If the actual order quantity is the economic order quantity in a problem that meets the assumptions of the economic order quantity model shown below, the average amount of inventory on hand:

question

to provide a hedge against inflation

answer

One use of inventory is

question

D)MRP

answer

Which of the following is not a type of inventory? A) Finished Goods B) Raw Materials C) work in process D) MRP

question

D) interest payments

answer

Which of the following does NOT belong to ordering costs? A) clerical support B) cost of supplies C) order processing D) interest payments

question

setup cost

answer

What is the cost to prepare a machine or process for production?

question

a probalistic model

answer

A statistical model applicable when product demand or any other variable is not known but can be specified by means of a probability distribution is referred as

question

single-period inventory model

answer

What is a system for ordering items that have little or no value at the end of a sales period?

question

shortage cost / (overage cost + shortage cost)

answer

For seasonal products, the service level should be set to equal

question

a fixed-period system

answer

A system that triggers ordering on a uniform time basis is called

question

Lead times are variable

answer

Which of the following is NOT one of the assumptions of fixed-period system? A) Lead times are variable B) Lead times are known C) Items are independent of one another D) the only relevant costs are the ordering and holding costs

question

D) increasing stockroom accessibility

answer

Inventory record accuracy would be decreased by A) ABC analysis B) cycle counting C) reorder points D) increasing stockroom accessibility

question

A) furniture

answer

A single-period inventory model is NOT applicable for A) furniture B) milk C) seasonal goods D) newspapers

question

choosing the level of safety stock that assures a given service level

answer

The appropriate level of safety stock is typically determined by

question

a perpetual inventory system

answer

A system that keeps track of each withdrawal or addition to inventory continuously is

question

strike a balance between inventory investment and customer service

answer

The objective of inventory management is to

question

D) order processing

answer

Which of the following does NOT belong to holding costs? A) insurance on inventory B) pilferage, scrap, and obsolescence C) storage costs D) order processing

question

cost per unit - salvage value per unit

answer

In a single period inventory model, the overage cost is

question

Raw materials inventory

answer

What inventory describes inventory that has been purchased but not processed?

question

either independent of or dependent on the demand for other items

answer

Inventory control models assume that demand for an item is

question

total inventory-based costs

answer

Most inventory models attempt to minimize

STUDY

Economic Order Quantity Long Term Needs Operations Management Product Development Process Start And Finish Vendor Managed Inventory

KRM-1 Quiz – Flashcards 15 terms

Shelby Arnold

15 terms

Preview

KRM-1 Quiz – Flashcards

question

If "every process and every person in an organization has customers," then, a) external suppliers provide only to external customers b) some customers are external and some are internal c) no customers can have both internal and external suppliers d)internal suppliers provide products to external customers

answer

b) some external ad some internal

question

which of the following outcomes is not a direct result of a market analysis? a) identical of customer needs b) corporate responses to changes in the business environment c) development of core competencies d) assessment of competitors strength

answer

c) development of core competencies

question

the core processes in a value chain must:

answer

add value for the external customers

question

support process:

answer

are also part of the value chain

question

characteristics of service provider operations: a) perishable outputs b) low labor requirements c) low customer contact d) tangible output

answer

a) perishable outputs

question

foundation for managing processes and value chains is a) operations strategy b) project management c) a market orientation d) globalization

answer

a) operations strategy

question

credit card processing firm would list which of the following competitive priorities for its external customers: a) concurrent engineering b) mass customization c) postponement d) consistent quality

answer

d) consistent quality

question

gymnastics was able to serve large crowds of customers and then adjust operations to serve very few customers thanks to their competitive capability relates to a) cost b) flexibility c) quality d) time

answer

b) flexibility

question

_______ are the fundamental activities that organizations use to do work and achieve their goals a) tasks b) inputs c) operations d) processes

answer

d) processes

question

which of the following considerations is not involved in developing a corporate strategy? a) developing a staffing plan for the upcoming production period b) monitoring and adjusting to changes in the business environment c) identifying and developing the firm's core competencies d) personding to pressures for flexibility

answer

a) developing a staffing plan for the upcoming production period

question

following scenarios illustrates an order winner:

answer

a) a safety conscious customer considers only vehicles that have side air bags and anti-lock brakes

question

core competencies reflect:

answer

the collective learning of the organization

question

core competencies include: a) an abundance of customers b) a well-trained, flexible workforce c) employee benefits d) an abundance of competitors

answer

b) a well-trained, flexible workforce

question

operations strategy translates service of product plans and competitive priorities for each market segments into:

answer

decisions affecting the processes that support those market segments

question

SSS is a local restaurant serving the needs of college students, faculty, and staff. The manager is considering adding a website so carry-out customer scan order in advance more easily. Which process would be a core process in this new undertaking? a) web design b) budgeting c) creating file system for recipes d) scheduling wait staff

answer

a) web design

STUDY

Center Of Gravity Economic Order Quantity Principles Of Marketing Right To Work Laws Safety Data Sheet Total Cost Of Ownership Twenty First Century Vendor Managed Inventory

Logistics Final – Flashcards 100 terms

Jaxon Craft

100 terms

Preview

Logistics Final – Flashcards

question

____ refers to stocks of goods and materials that are maintained for many purposes, the most common being to satisfy normal demand patterns

answer

Inventory

question

Holding high levels of inventory result in ______ inventory carrying costs and ____ stockout costs.

answer

High; low

question

_____ stock refers to inventory that is needed to satisfy normal demand during the course of an order cycle.

answer

Base

question

_____ stock refers to inventory that is held in addition to cycle stock to guard against uncertainty in demand and/or lead time.

answer

Buffer

question

____ stock refers to inventory that is en route between various nodes in a logistics system.

answer

Pipeline

question

___ stock refers to inventory that is held for several reasons, to include seasonal demand, projected price increases, and potential shortages of product.

answer

Speculative

question

____ stock is carried to stimulate demand.

answer

Psychic

question

Inventory costs in the U.S. in the twenty-first century represent approximately ____ of total logistics costs

answer

one-third

question

Inventory carrying costs in the U.S. in the 21st century have ranged between ____ and ____ percent.

answer

19;24

question

Inventory shrinkage:

answer

refers to the fact that more items are recorded entering than leaving warehousing facilities

question

In the United States, _____ has traditionally provided a convenient starting point when estimating the interest charges associated with maintaining inventory.

answer

The prime rate of interest

question

Which of the following situations is likely the most damaging with respect to a stockout?

answer

customer goes to a competitor for this purchase

question

Under conditions of certainty, a reorder point is equal to:

answer

average daily demand in units times the length of the replenishment cycle

question

The economic order quantity deals with calculating the proper order size with respect to ___ costs and ____ costs.

answer

carrying; ordering

question

The EOQ determines:

answer

the point at which the sum of carrying costs and ordering costs is maximized

question

concerning the EOQ model, if demand or annual usage increases by 10%, then the EOQ will:

answer

increase

question

concerning the EOQ model, if the ordering costs increase by 10% and the product value increases by 10%, then the EOQ will:

answer

increase

question

Inventory flow diagrams illustrate that safety stock can prevent two problem areas, _____ and ______.

answer

increased rate of demand; longer-than-normal replenishment

question

ABC analysis of inventory:

answer

Recognizes that inventories are not of equal value to a firm

question

Dead inventory refers to product for which there is no sales during a ____ month period.

answer

twelve

question

All of the following are suggestions for dealing with a dead stock except ____

answer

all of the above are suggestions

question

Inventory turnover can be calculated by

answer

adding beginning and ending inventory; divide by two

question

____ items refer to those that are used or distributed together.

answer

Complementary

question

___ products refer to those that are used or distributed together.

answer

Substitue

question

Under ____, the size and timing of replenishment orders are the responsibility of the manufacturer.

answer

vendor-managed inventory

question

The initial focus in facility location is ____

answer

region

question

_____ is the most popular location for near-sourcing among companies that do business in North America.

answer

Mexico

question

What two countries account for approximately one-third of the world's population?

answer

China and India

question

A locavore strategy:

answer

refers to purchasing locally grown or produced foods

question

The general trend in recent years has been for companies to do what with their distribution networks?

answer

reduce the number of fatalities

question

A pure material:

answer

is one that loses no weight in manufacturing and/or processing

question

the processing point for a weight-losing raw material:

answer

should be near its source

question

the processing point for a weight-gaining raw material:

answer

should be near the final market

question

Over the past quarter century, discussion of natural resources and facility location has increasingly factored in ____ considerations.

answer

environmental

question

Labor force ___ are a key locational determinant as supply chains become more global in nature.

answer

wage rates

question

____ plants, which are located just south of the U.S.- Mexican border, provide much needed jobs to Mexican workers and allow for low-cost, duty-free production so long as all the goods are exported from Mexico.

answer

Maquilladora

question

Right-to-work laws refer to a situation where:

answer

an individual cannot be compelled to join a union as a condition of employment

question

An expatriate refers to a person:

answer

who is sent to work in other countries for extended periods of time

question

turnover rates for expatriate workers current run between ____ percent.

answer

20 and 40

question

from a business perspective, _____ taxes are analogous to the personal property taxes paid by individuals.

answer

inventory

question

the existence of transportation competition, whether intermodal or intramodal, tends to:

answer

have both cost and service benefits to users

question

____ refers to the net advantages which can be gained by a sharing of common locations by various enterprises.

answer

Agglomeration

question

With respect to commodity flows, logisticians are especially interested in ___ and ___.

answer

how much is being produced; where it is being shipped.

question

The European Union's expansion into Central and Eastern European countries has resulted in Poland and ___ becoming favored distribution sites because of their relatively central location.

answer

Czech Republic

question

Which of following is not a possible quality of life consideration in facility location?

answer

all of the above are quality of life considerations

question

A "brownfield" is

answer

a property for which use and redevelopment is complicated by past use.

question

A free trade zone refers to:

answer

an area in which products can be stored, exhibited, or processed without being subjected to duties and quotas unless they enter the customs territory of the zone country.

question

The center-of-gravity approach to location analysis minimizes:

answer

distance to existing facilities

question

How does the weighted center-of-gravity approach to location analysis differ from the center-of-gravity approach to location analysis?

answer

the weighted approach considers shipment volume

question

the Worker Adjustment and Retraining Notification (WARN) Act mandates that employers give ____ days notice about plant closings and mass layoffs.

answer

60.

question

Warehousing and ____ are substitutes for each other.

answer

transportation.

question

_____ and ____ refer to adjustments associated with the quantity of product.

answer

Accumulating; allocating

question

______ involves bringing together similar stocks from different sources.

answer

Accumulating

question

____ refers to building up a variety of different products for resale to particular customers.

answer

Assorting

question

Warehouses emphasize ____ and their primary purpose is to maximize ___

answer

product storage; usage of available storage space

question

Distribution centers emphasize ___ and their primary purpose is to ____.

answer

rapid movement of product; throughput.

question

Throughput refers to:

answer

amount of product entering and leaving a facility in a given time period.

question

____ refers to a process where a product is received in a facility, occasionally married with product going to the same destination, and then shipped at the earliest time, without going into longer-term storage.

answer

cross-docking

question

Warehousing labor safety practices in the U.S. are monitored by which federal government agency?

answer

None of the above

question

What is considered to be the biggest drawback to public warehousing?

answer

Lack of control by the user

question

____ warehousing is owned or occupied on a long-term lease by the firm using them,

answer

Private

question

With respect to contract warehousing, ____ to ___ year contracts appear to allow sufficient time for the warehousing provider to learn the client's business while allowing the client some flexibility in case the agreement fails to produce acceptable results.

answer

3;5

question

Multiclient warehousing mixes attributes of ____ and ___ warehousing.

answer

public; contract

question

One of the best pieces of advice with respect to the design of warehousing facilities is to ___.

answer

use common sense

question

tradeoffs must be among space, labor, and ___ with respect to warehousing design.

answer

mechanization

question

A key advantage of fixed slot locations in a warehouse is:

answer

knowledge of where specific products are located

question

A key advantage of variable slot locations in a warehouse is:

answer

increased space utilization.

question

As one builds higher, building costs ____, while warehousing equipment costs tend to ___.

answer

decrease; increase

question

narrow aisles can store ___ to ___ percent more product than conventional width aisles.

answer

20;25

question

one estimate suggests that only approximately ___ percent of a facility's cubic capacity is actually occupied by product.

answer

question

What is dunnage?

answer

material that is used to block and brace products inside carrier equipment

question

A materials safety data sheet( MSDS) is required for:

answer

each hazardous product to be stored in a facility

question

which of the following is not one of the common causes of warehousing fires?

answer

lightning strikes

question

According to the Occupational Safety and Health Administration, approximately ___ employees are killed each year while operating forklifts in warehousing facilities.

answer

100

question

In general, warehousing security can be enhanced by focusing on people, ___, and ____.

answer

facilities, processes.

question

Product density refers to a product's _____.

answer

weight per volume

question

The building blocks concept is associated with which logistics function?

answer

packaging

question

___ refers to materials used for the containment, protection, handling, delivery, and presentation of goods.

answer

packaging

question

each of the following is a shipping hazard that a package may be exposed to except ___.

answer

all of the above are shipping hazards for a package

question

as a general rule, labeling requirements and enforcement tend to be more stringent in ____ countries than in ____ countries.

answer

economically developed; economically developing

question

The Globally Harmonized System of Classification and Labeling of Chemicals (GHS) was developed by the:

answer

United Nations

question

Over 80% of customers view packaging as ____

answer

a major environmental issue

question

which of the following is not a characteristic of plastic packaging?

answer

lack of versatility

question

which of the following is not an environmentally-friendly packaging strategy that firms might adopt?

answer

all of the above are strategies

question

____ systems consider the reverse flow of products, their reuse, and the marketing and distribution of recovered products.

answer

closed-loop

question

how many countries in the world do not currently use the metric system of measurement?

answer

three

question

what has been described as the "last frontier" of logistics savings opportunities?

answer

packaging inefficiencies.

question

A "box-maker's certificate":

answer

assures railroads and motor carries that boxes are sufficiently sturdy to meet their handling requirements.

question

A unit load involves:

answer

consolidation of several units into larger units to improve efficiency in handling and to reduce shipping costs

question

The major advantage of the unit load is:

answer

mechanical devices can be substituted for manual labor

question

The ___ has established six international pallet size standards.

answer

International standards organization

question

The basic unit in unit loading is:

answer

a pallet

question

A major drawback to metal and plastic pallets is their ____.

answer

lifespan

question

____ pounds is the approximate weight at which there is a noticeable increase in injuries, particularly back injuries, from manual handling.

answer

Fifty (50)

question

What do we call the short distance movement that usually takes place within the confines of a building such as a plant of DC and between a building and a transportation service provider

answer

materials handling

question

with respect to density, a vessel loaded with ___ is most likely to cube out.

answer

coal

question

a dry bulk material's ___ is important for determining the quantity that can be stored in a given location

answer

angle of repose

question

_____ refers to the interaction between workers and workplace conditions

answer

ergonomics

question

the total cost of ownership is associated with which of the 10 materials handling principles?

answer

life cycle cost principle

question

it is important that the materials handling equipment be aligned with an organization's objectives, customers, and ____.

answer

products

STUDY

Demand Economic Order Quantity Finished Goods Inventory Principles Of Marketing

MGMT 480 CHAPTER 12 – Flashcards 21 terms

Maisie Clarke

21 terms

Preview

MGMT 480 CHAPTER 12 – Flashcards

question

1. In ABC inventory analysis, which of the following is true for "C" items? a. Tighter control of "C" items (than for "A" or "B" items) is appropriate. b. "C" items are critical items that must be monitored with a fixed period system. c. "C" items make up a lower percentage of total inventory value ($) than either "A" or "B" items. d. "C" items make up 10-20 percent of inventory items.

answer

question

Inventory that represents partially completed products waiting further processing is called ____ inventory. a. Raw materials b. Work-in-process c. Cycle d. Safety stock

answer

question

Additional inventory kept over and above the average amount required to meet demand is called ____ inventory. a. Seasonal b. Work-in-process c. Finished goods d. Safety stock

answer

question

Inventory that acts as a buffer between workstations in flow shops or departments in job shops is called ____ inventory. a. Raw materials b. Work-in-process c. Cycle stock d. Safety stock

answer

question

Costs associated with inspecting, unpacking and putting into storage incoming inventory are components of ____ cost. a. Ordering or setup b. Holding c. Shortage d. Unit

answer

question

Which of the following is not a component of holding cost? a. Taxes b. Insurance c. Material handling d. Order processing

answer

question

Two fundamental inventory decisions are when to order and how much to order. Which of the following statement is true with respect to Fixed Quantity (FQS) and Fixed Period (FPS) inventory systems? a. A FPS orders a fixed period quantity when the inventory position reaches or drops below the reorder point (r). b. A FPS must cover a time period of T + L to cover the risk of a stock out. c. A FPS places an order for the economic order quantity every T time units. d. A FQS places an order to replenish the inventory position up to a target level (M) when the inventory position reaches the reorder point (r).

answer

question

Independent demand a. can be derived/calculated b. is related to other SKUs c. is also called finished goods inventory d. needs to be forecasted

answer

question

Demand that incorporates uncertainty is called ____. a. Static b. Dynamic c. Stochastic d. Deterministic

answer

question

Demand that varies over time is called ____. a. Static b. Dynamic c. Stochastic d. Deterministic

answer

question

Demand that is stable over time is called ____. a. Static b. Dynamic c. Stochastic d. Deterministic

answer

question

Which of the following is incorrect regarding inventory management? a. The two fundamental inventory decisions are when to order and what to order b. Inventory management applies to goods and to services c. Different types of inventory characteristics require different approaches for control d. SKUs are often aggregated or partitioned into groups with similar characteristics or dollar value

answer

question

Backorders ____. a. Result from lost sales b. Have little financial impact c. May occur as a result of a stockout d. Force a customer to purchase elsewhere

answer

Economic Order Quantity Flashcards, test questions and answers

We've found 23 Economic Order Quantity tests