CSCP Module 1 Exam Questions With Verified Answers

CSCP Module 1 Exam Questions With Verified Answers Decoupling - answerCreating independence between supply and use of material. Commonly denotes providing inventory between operations so that fluctuations in the production rate of the supplying operation do not constrain production or use rates of the next operation. gross margin - answerThe difference between total revenue and cost of goods sold optimization - answerAchieving the best possible solution to a problem in terms of a specified objective function. cycle stock - answerOne of the two main conceptual components of any item inventory, the cycle stock is the most active component; the cycle stock depletes gradually as customer orders are received and is replenished cyclically when supplier orders are received. The other conceptual component of the item inventory is the safety stock, which is a cushion of protection against uncertainty in the demand or in the replenishment lead time. stockout costs - answerThose costs may include lost sales, backorder costs, expediting, and additional manufacturing and purchasing costs Interplant demand - answerOne plant's need for a part or product that is produced by another plant or division within the same organization. Although it is not a customer order, it is usually handled by the master production scheduling system in a similar manner. Demand shaping - answerThe practice of using the 4 Ps (product, pricing, placement, promotion) and other market variables to influence the demand of a product or service so that the demand better matches the available supply. buffer - answer1) A quantity of materials awaiting further processing. It can refer to raw materials, semifinished stores or hold points, or a work backlog that is purposely maintained behind a work center. 2) In the theory of constraints, these can be time or material and support throughput and/or due date performance. They can be maintained at the constraint, convergent points (with a constraint part), divergent points, and shipping points. standard costs - answerThe target costs of an operation, process, or product including direct material, direct labor, and overhead charges. demand forecasting - answerForecasting the demand for a particular good, component, or service. return on investment ROI - answerA relative measure of financial performance that provides a means for comparing various investments by calculating the profits returned during a specified time period. theory of constraints ROI - answercalculated as throughput minus operating expense divided by investment. pull system - answer1) In production, the production of items only as demanded for use or to replace those taken for use. 2) In material control, the withdrawal of inventory as demanded by the using operations. Material is not issued until a signal comes from the user. 3) In distribution, a system for replenishing field warehouse inventories where replenishment decisions are made at the field warehouse itself, not at the central warehouse or plant. vendor - answerA business from which merchandise, supplies, or other assets are purchased. service industry - answer1) In its narrowest sense, an organization that provides an intangible product (e.g., medical or legal advice). 2) In its broadest sense, all organizations except farming, mining, and manufacturing. market driven - answerresponding to customer needs process chart - answerA chart that represents the sequence of work or the nature of events in process. It serves as a basis for examining and possibly improving the way the work is carried out. Obsolescence - answer1) The condition of being out of date. A loss of value occasioned by new developments that place the older property at a competitive disadvantage. A factor in depreciation. 2) A decrease in the value of an asset brought about by the development of new and more economical methods, processes, or machinery. 3) The loss of usefulness or worth of a product or facility as a result of the appearance of better or more economical products, methods, or facilities. tactical buying - answerThe purchasing process focused on transactions and nonstrategic material buying. It is closely aligned with the "ordering" portion of executing the purchasing transaction process. The characteristics for tactical buying include stable, limited fluctuations, defined standard specifications, noncritical to production, no delivery issues, and high reliability concerning quality-standard material with very little concern for rejects. Cost of goods sold COGS - answerAn accounting classification useful for determining the amount of direct materials, direct labor, and allocated overhead associated with the products sold during a given period of time. Inventory optimization software - answerA computer application having the capability of finding optimal inventory strategies and policies related to customer service and return on investment over several echelons of a supply chain. balanced scorecard - answerA list of financial and operational measurements used to evaluate organizational or supply chain performance. The dimensions of this tool might include customer perspective, business process perspective, financial perspective, and innovation and learning perspectives. It formally connects overall objectives, strategies, and measurements. Each dimension has goals and measurements. competitive analysis - answerAn analysis of a competitor that includes its strategies, capabilities, prices and costs. purchasing - answerThe term used in industry and management to denote the function of and the responsibility for procuring materials, supplies, and services. Demand management - answer1) The function of recognizing all demands for goods and services to support the marketplace. It involves prioritizing demand when supply is lacking. Proper demand management facilitates the planning and use of resources for profitable business results. 2) In marketing, the process of planning, executing, controlling, and monitoring the design, pricing, promotion, and distribution of products and services to bring about transactions that meet organizational and individual needs. strategic sourcing - answerA comprehensive approach for locating and sourcing key material suppliers, which often includes the business process of analyzing total-spend-for-material spend categories. There is a focus on the development of long-term relationships with trading partners who can help the purchaser meet profitability and customer satisfaction goals. horizontal marketplace - answerAn online marketplace used by buyers and sellers from multiple industries. This marketplace lowers prices by lowering transaction costs. Inventory turnover - answerThe number of times that an inventory cycles, or "turns over," during the year. A frequent method to compute inventory turnover is to divide the average inventory level into the annual cost of sales. For example, an average inventory of $3 million divided into an annual cost of sales of $21 million means that inventory turned over seven times. Push system - answer1) In production, the production of items at times required by a given schedule planned in advance. 2) In material control, the issuing of material according to a given schedule or issuing material to a job order at its start time. 3) In distribution, a system for replenishing field warehouse inventories where replenishment decision making is centralized, usually at the manufacturing site or central supply facility. Balance sheet - answerA financial statement showing the resources owned, the debts owed, and the owner's share of a company at a given point in time. Gross profit - answerearnings from an ongoing business after direct costs of goods sold have been deducted from sales revenue for a given period. Operating profit - answerearnings or income after all expenses (selling, administrative, depreciation) have been deducted from gross profit.