SCM 300 EXAM 1 VERIFIED ANSWERS AND QUESTIONS -
MOST RECENT EDITION 2026
1. What are the 3 branches of supply chain? ANSWER procurement
(purchasing), operation, logistics, reverse
2. What is Procurement (purchasing)? ANSWER the branch of supply
chain where deals happen, negotiations for the best price on materials,
equipment, goods, and services. acquiring materials and placing orders.
3. What is Operations? ANSWER the branch responsible for making
business processes effective and efficient (help create high quality
products/services using fewest resources possible).
4. What is Logistics? ANSWER is concerned with transportation, finding
the right partners or best ways to get the product or service from origin
to consumption.
5. What are the key variables in elementary inventory calculations?
ANSWER Q - lot size D - annual demand C - cost to purchase one unite H
- cost to hold on unit of inventory in one year S - cost to place a single
order
6. What is the Annual cost to purchase inventory? ANSWER DC
7. What is the Annual Holding Cost (AHC)? ANSWER (Q/2)*H
8. What is the Annual Ordering Cost (AOC)? ANSWER (D/Q)S
9. What is the Equation for total cost? ANSWER DC + AHC + AOC
10. What is Economic Order Quantity (EOQ)? ANSWER the lot size that
minimizes total annual inventory holding and ordering costs, making it
the optimal lot size = SQRT (2DS/H) if a manager is looking to minimize
inventory costs and maximize total annual savings then he would
calculate optimal lot size through this formula.
, 11. What is Cycle time? ANSWER the pace at which product must move
through the assembly line in order for the assembly line to keep pace
with demand. = Operating Time/D
12. What is the Theoretical Minimum number of workstations calculations
(TM)? ANSWER total task time / cycle time
13. What are the 3 Supply Chain Flows? ANSWER Money, material,
information
14. What is the downstream supply chain? ANSWER the direction that
points towards the end customer Ex: delivering goods from a
manufacturer to a distributor. main suppliers s1 working to get parts
prepared in time for manufacturer.
15. What is the Upstream Supply Chain? ANSWER going backwards,
moving towards the supplier. ex: finding ways to maximize efficiency
coming back. see if all the boxes that have arrived at the retailer are
empty and not damaged to send them beck for reuse. developing
relationships with the companies first tier supplier to enhance and better
communication.
16. What are the Supply chain competitive priorities? ANSWER cost,
quality, speed, flexibility For example, a fast food restaurant will
customize these priorities differently from a higher up restaunt
17. What does the Cost competitive priority consist of? ANSWER
material, energy, waste, transportation
18. What does the Quality competitive priority consist of? ANSWER
design, reliability, consistency, materials or fabrics
19. What does the speed competitive priority consist of? ANSWER
delivery, on time, innovative time
20. What does the flexibility competitive priority consist of? ANSWER
customization, size of orders, design
21. What are the Types of inventory? ANSWER -raw materials -work in
process -finished goods -maintenance, repair, and operating -market
inventory -safety stock (buffer stock) -anticipation inventory -pipeline
inventory -inventory visibility
MOST RECENT EDITION 2026
1. What are the 3 branches of supply chain? ANSWER procurement
(purchasing), operation, logistics, reverse
2. What is Procurement (purchasing)? ANSWER the branch of supply
chain where deals happen, negotiations for the best price on materials,
equipment, goods, and services. acquiring materials and placing orders.
3. What is Operations? ANSWER the branch responsible for making
business processes effective and efficient (help create high quality
products/services using fewest resources possible).
4. What is Logistics? ANSWER is concerned with transportation, finding
the right partners or best ways to get the product or service from origin
to consumption.
5. What are the key variables in elementary inventory calculations?
ANSWER Q - lot size D - annual demand C - cost to purchase one unite H
- cost to hold on unit of inventory in one year S - cost to place a single
order
6. What is the Annual cost to purchase inventory? ANSWER DC
7. What is the Annual Holding Cost (AHC)? ANSWER (Q/2)*H
8. What is the Annual Ordering Cost (AOC)? ANSWER (D/Q)S
9. What is the Equation for total cost? ANSWER DC + AHC + AOC
10. What is Economic Order Quantity (EOQ)? ANSWER the lot size that
minimizes total annual inventory holding and ordering costs, making it
the optimal lot size = SQRT (2DS/H) if a manager is looking to minimize
inventory costs and maximize total annual savings then he would
calculate optimal lot size through this formula.
, 11. What is Cycle time? ANSWER the pace at which product must move
through the assembly line in order for the assembly line to keep pace
with demand. = Operating Time/D
12. What is the Theoretical Minimum number of workstations calculations
(TM)? ANSWER total task time / cycle time
13. What are the 3 Supply Chain Flows? ANSWER Money, material,
information
14. What is the downstream supply chain? ANSWER the direction that
points towards the end customer Ex: delivering goods from a
manufacturer to a distributor. main suppliers s1 working to get parts
prepared in time for manufacturer.
15. What is the Upstream Supply Chain? ANSWER going backwards,
moving towards the supplier. ex: finding ways to maximize efficiency
coming back. see if all the boxes that have arrived at the retailer are
empty and not damaged to send them beck for reuse. developing
relationships with the companies first tier supplier to enhance and better
communication.
16. What are the Supply chain competitive priorities? ANSWER cost,
quality, speed, flexibility For example, a fast food restaurant will
customize these priorities differently from a higher up restaunt
17. What does the Cost competitive priority consist of? ANSWER
material, energy, waste, transportation
18. What does the Quality competitive priority consist of? ANSWER
design, reliability, consistency, materials or fabrics
19. What does the speed competitive priority consist of? ANSWER
delivery, on time, innovative time
20. What does the flexibility competitive priority consist of? ANSWER
customization, size of orders, design
21. What are the Types of inventory? ANSWER -raw materials -work in
process -finished goods -maintenance, repair, and operating -market
inventory -safety stock (buffer stock) -anticipation inventory -pipeline
inventory -inventory visibility
