CSCP MOD 3 CH 1 & 2 SEC C EXAM
SUCCESS CH 2 QUESTIONS &
ACCURATE CORRECT PASSED
ANSWERS
What would a retail organization most likely use as its measure of inventory when
calculating inventory turnover? - Correct Answer ✔✔ Average inventory at selling price.
Since inventory at one point in time might be deceivingly high or low, most organizations
calculate average inventory. Retailers favor measuring inventory value at selling price,
because it is the most accurate valuation for them
If an organization is more responsive than efficient and more strategic than operational
in its measurement focus, what would be the best place for it to be on a measurement
frequency continuum? - Correct Answer ✔✔ Diagnostic. A framework for helping
organizations select the best metrics was developed by Griffis, Cooper, Goldsby, and
Closs and described in an article titled "Aligning Logistics Performance Measures to the
Information Needs of the Firm." 3-133/
What is a category of operational metrics in the manufacturing industry? - Correct
Answer ✔✔ Quality is an operational metric, because it relates to accuracy,
manufacturing goods to quality standards, avoidance of damage to goods at various
stages, and so on
When would shifting costs from an organization to its suppliers be a good idea from a
long-term perspective? - Correct Answer ✔✔ When supply chain total cost goes down
Which group of financial ratios helps determine whether a supplier is likely to be able to
meet its debt obligations based on relative levels of debt versus equity? - Correct
Answer ✔✔ Leverage ratios
From a supply chain management perspective, what would be the best source of
information to use for calculating average inventory as an input to cash-to-cash cycle
time? - Correct Answer ✔✔ Actual inventory level divided by average daily demand
An organization's inventory on its balance sheet in year 1 is $6 million and in year 2 it is
$4 million. If its cost of goods sold (COGS) in year 2 is $80 million, what is its inventory
turnover ratio? - Correct Answer ✔✔ The inventory turnover ratio requires calculating
average inventory, which in this case uses the balance sheet values for years 1 and 2,
which are ($6 million + $4 million)/2 = $5 million. The inventory turnover ratio is COGS
divided by average inventory: $80 million/$5 million = 16 times
SUCCESS CH 2 QUESTIONS &
ACCURATE CORRECT PASSED
ANSWERS
What would a retail organization most likely use as its measure of inventory when
calculating inventory turnover? - Correct Answer ✔✔ Average inventory at selling price.
Since inventory at one point in time might be deceivingly high or low, most organizations
calculate average inventory. Retailers favor measuring inventory value at selling price,
because it is the most accurate valuation for them
If an organization is more responsive than efficient and more strategic than operational
in its measurement focus, what would be the best place for it to be on a measurement
frequency continuum? - Correct Answer ✔✔ Diagnostic. A framework for helping
organizations select the best metrics was developed by Griffis, Cooper, Goldsby, and
Closs and described in an article titled "Aligning Logistics Performance Measures to the
Information Needs of the Firm." 3-133/
What is a category of operational metrics in the manufacturing industry? - Correct
Answer ✔✔ Quality is an operational metric, because it relates to accuracy,
manufacturing goods to quality standards, avoidance of damage to goods at various
stages, and so on
When would shifting costs from an organization to its suppliers be a good idea from a
long-term perspective? - Correct Answer ✔✔ When supply chain total cost goes down
Which group of financial ratios helps determine whether a supplier is likely to be able to
meet its debt obligations based on relative levels of debt versus equity? - Correct
Answer ✔✔ Leverage ratios
From a supply chain management perspective, what would be the best source of
information to use for calculating average inventory as an input to cash-to-cash cycle
time? - Correct Answer ✔✔ Actual inventory level divided by average daily demand
An organization's inventory on its balance sheet in year 1 is $6 million and in year 2 it is
$4 million. If its cost of goods sold (COGS) in year 2 is $80 million, what is its inventory
turnover ratio? - Correct Answer ✔✔ The inventory turnover ratio requires calculating
average inventory, which in this case uses the balance sheet values for years 1 and 2,
which are ($6 million + $4 million)/2 = $5 million. The inventory turnover ratio is COGS
divided by average inventory: $80 million/$5 million = 16 times
