MQM 227 Ch.20 Exam 100% Solved
For this model, inventory for the item is monitored until it gets down to a level where the risk of
stocking out is great enough that we are compelled to order. —Answer: Fixed-order quantity
model
___ is the stock of any item or resource used in an organization. —Answer: Inventory
Which of the following is a policy and control of an inventory system?
How one will finance the stock
Who should order the stock
When stock should be replenished
The payment terms associated with buying the stock from vendors —Answer: When stock
should be replenished
Select all that apply
Which of the following is/are manufacturing inventory items?
Finished products
Work-in-process
In-transit supplies
Component parts in manufacturing —Answer: Finished products
Work-in-process
Component parts in manufacturing
____ inventory includes in-transit items or at a warehouse ready for shipment to the customer.
—Answer: Distribution
This model is used in situations like selling T-shirts at a one-time sporting event. —Answer:
The single-period model
The stock of any item or resource used in an organization is called? —Answer: Inventory
In services, inventory generally refers to any ____ good and the ____ necessary to administer
the service. —Answer: physical
parts
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, The set of policies and controls that monitor levels of inventory and determine what levels
should be maintained, when stock should be replenished, and how large orders should be is
called a(n) ____ system. —Answer: inventory
True or false: One purpose of holding inventory is to meet variation of product demand. —
Answer: True
Work-in-process is considered _____ inventory. —Answer: manufacturing
Which of the following is considered to be warehouse inventory? —Answer: Finished goods
inventory in a distribution center
Which of the following is not a cost associated with inventory management?
Setup costs
Transportation costs
Ordering costs
Shortage costs
Holding costs —Answer: Transportation costs
True or false: Inventory is not an issue for services because services do not carry inventory. —
Answer: False
True or false: By taking advantages of economic purchase order sizes, one can usually achieve
lower per-unit shipping costs. —Answer: True
Inventory holding costs are also known as ____ costs. —Answer: carrying
Setup costs are also known as production ___ costs. —Answer: change
As it relates to inventory, a buyer's time expended to prepare the purchase order for more
material is considered a(n) ____ cost. —Answer: ordering
The managerial and clerical costs to prepare purchase or production orders are called: —
Answer: ordering costs
How many axes are used for the inventory-control-system design matrix framework? —
Answer: 3
High holding costs tend to favor ____ inventory levels and ____ replenishment. —Answer: low
frequent
Delta Company uses special equipment and personnel to changeover production runs quickly.
The costs associated with this changeover approach are considered —Answer: Setup costs
Which of the following are inventory ordering costs? Check all that apply.
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For this model, inventory for the item is monitored until it gets down to a level where the risk of
stocking out is great enough that we are compelled to order. —Answer: Fixed-order quantity
model
___ is the stock of any item or resource used in an organization. —Answer: Inventory
Which of the following is a policy and control of an inventory system?
How one will finance the stock
Who should order the stock
When stock should be replenished
The payment terms associated with buying the stock from vendors —Answer: When stock
should be replenished
Select all that apply
Which of the following is/are manufacturing inventory items?
Finished products
Work-in-process
In-transit supplies
Component parts in manufacturing —Answer: Finished products
Work-in-process
Component parts in manufacturing
____ inventory includes in-transit items or at a warehouse ready for shipment to the customer.
—Answer: Distribution
This model is used in situations like selling T-shirts at a one-time sporting event. —Answer:
The single-period model
The stock of any item or resource used in an organization is called? —Answer: Inventory
In services, inventory generally refers to any ____ good and the ____ necessary to administer
the service. —Answer: physical
parts
© 2025 All rights reserved
, The set of policies and controls that monitor levels of inventory and determine what levels
should be maintained, when stock should be replenished, and how large orders should be is
called a(n) ____ system. —Answer: inventory
True or false: One purpose of holding inventory is to meet variation of product demand. —
Answer: True
Work-in-process is considered _____ inventory. —Answer: manufacturing
Which of the following is considered to be warehouse inventory? —Answer: Finished goods
inventory in a distribution center
Which of the following is not a cost associated with inventory management?
Setup costs
Transportation costs
Ordering costs
Shortage costs
Holding costs —Answer: Transportation costs
True or false: Inventory is not an issue for services because services do not carry inventory. —
Answer: False
True or false: By taking advantages of economic purchase order sizes, one can usually achieve
lower per-unit shipping costs. —Answer: True
Inventory holding costs are also known as ____ costs. —Answer: carrying
Setup costs are also known as production ___ costs. —Answer: change
As it relates to inventory, a buyer's time expended to prepare the purchase order for more
material is considered a(n) ____ cost. —Answer: ordering
The managerial and clerical costs to prepare purchase or production orders are called: —
Answer: ordering costs
How many axes are used for the inventory-control-system design matrix framework? —
Answer: 3
High holding costs tend to favor ____ inventory levels and ____ replenishment. —Answer: low
frequent
Delta Company uses special equipment and personnel to changeover production runs quickly.
The costs associated with this changeover approach are considered —Answer: Setup costs
Which of the following are inventory ordering costs? Check all that apply.
© 2025 All rights reserved
