©BRIGHTSTARS EXAM SOLUTIONS
11/16/2024 10:16 AM
ODM Ch. 12 Exam Questions With Correct
Answers.
Raw material inventory - answer✔materials that are usually purchased but have yet to enter
the manufacturing process
work-in-process (WIP) inventory - answer✔products or components that are no longer raw
materials but have yet to become finished products
MRO - answer✔maintenance, repair, and operating materials
finished-goods inventory - answer✔an end item ready to be sold, but still an asset on the
company's books.
ABC analysis - answer✔a method for dividing on-hand inventory into three classifications based
on annual dollar volume.
cycle counting - answer✔a continuing reconciliation of inventory with inventory records
shrinkage - answer✔retail inventory that is unaccounted for between receipt and sale.
pilferage - answer✔a small amount of theft
holding cost - answer✔the cost to keep or carry inventory in stock.
ordering cost - answer✔the cost of the ordering process
setup cost - answer✔the cost to prepare a machine or process for production
setup time - answer✔the time required to prepare a machine or process for production
economic order quantity (EOQ) model - answer✔an inventory-control technique that minimizes
the total of ordering and holding costs
robust - answer✔giving satisfactory answers even with substantial variation in the parameters
lead time - answer✔in purchasing systems, the time between placing an order and receiving it;
in production systems, the wait, move, queue, setup, and run times for each component
produced
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11/16/2024 10:16 AM
ODM Ch. 12 Exam Questions With Correct
Answers.
Raw material inventory - answer✔materials that are usually purchased but have yet to enter
the manufacturing process
work-in-process (WIP) inventory - answer✔products or components that are no longer raw
materials but have yet to become finished products
MRO - answer✔maintenance, repair, and operating materials
finished-goods inventory - answer✔an end item ready to be sold, but still an asset on the
company's books.
ABC analysis - answer✔a method for dividing on-hand inventory into three classifications based
on annual dollar volume.
cycle counting - answer✔a continuing reconciliation of inventory with inventory records
shrinkage - answer✔retail inventory that is unaccounted for between receipt and sale.
pilferage - answer✔a small amount of theft
holding cost - answer✔the cost to keep or carry inventory in stock.
ordering cost - answer✔the cost of the ordering process
setup cost - answer✔the cost to prepare a machine or process for production
setup time - answer✔the time required to prepare a machine or process for production
economic order quantity (EOQ) model - answer✔an inventory-control technique that minimizes
the total of ordering and holding costs
robust - answer✔giving satisfactory answers even with substantial variation in the parameters
lead time - answer✔in purchasing systems, the time between placing an order and receiving it;
in production systems, the wait, move, queue, setup, and run times for each component
produced
1|Page
