MGMT 339 Final Exam questions well
answered
Inventory - correct answer ✔✔A stock of goods. They are a vital part of business: necessary for
operations and contribute to customer satisfaction. A "typical" firm has roughly 30% of its
current assets and as much as 90% of its working capital invested in inventory.
Independent Demand Items - correct answer ✔✔Items that are ready to be sold or used.
Types of Inventory - correct answer ✔✔- Raw materials and purchased parts
- WIP
- Finished goods inventories or merchandise
- Tools and supplies
- Maintenance and repairs (MRO) inventory
- Goods-in-transit to warehouses or customers (pipeline inventory)
Level of Customer Service (IM) - correct answer ✔✔Having the right goods available in the right
quantity in the right place at the right time
Inventory Management OBJ - correct answer ✔✔To achieve satisfactory levels of customer
service while keeping inventory costs within reasonable bounds
Inventory Management FUNS - correct answer ✔✔- To establish a system for tracking items in
inventory
- Make decisions about when and how much to order
, Inventory Management EFF REQ - correct answer ✔✔- A system keep track of inventory
- A reliable forecast of demand
- Knowledge of lead time and lead variability
- Reasonable estimates of: holding costs, ordering costs, shortage costs
- A classification system for inventory items
Periodic System - correct answer ✔✔Physical count of items in inventory made at periodic
intervals
Perpetual Inventory - correct answer ✔✔System that keeps track of removals from inventory
continuously, thus monitoring current levels of each item. An order is placed when inventory
drops to a predetermined minimum level.
Two-bin System - correct answer ✔✔Two containers of inventory; reorder when the first is
empty
Forecasts - correct answer ✔✔Inventories are necessary to satisfy customer demands, so it is
important to have a reliable estimates of the amount and timing of demand
Point-of-Sale (POS) Systems - correct answer ✔✔A system that electronically records actual
sales. This is helpful for enhancing forecasting and inventory management.
Lead Time - correct answer ✔✔Time interval between ordering and receiving the order
Purchase Cost - correct answer ✔✔The amount paid to buy the inventory
Holding (carrying) Costs - correct answer ✔✔Cost to carry an item in inventory for a length of
time, usually a year
answered
Inventory - correct answer ✔✔A stock of goods. They are a vital part of business: necessary for
operations and contribute to customer satisfaction. A "typical" firm has roughly 30% of its
current assets and as much as 90% of its working capital invested in inventory.
Independent Demand Items - correct answer ✔✔Items that are ready to be sold or used.
Types of Inventory - correct answer ✔✔- Raw materials and purchased parts
- WIP
- Finished goods inventories or merchandise
- Tools and supplies
- Maintenance and repairs (MRO) inventory
- Goods-in-transit to warehouses or customers (pipeline inventory)
Level of Customer Service (IM) - correct answer ✔✔Having the right goods available in the right
quantity in the right place at the right time
Inventory Management OBJ - correct answer ✔✔To achieve satisfactory levels of customer
service while keeping inventory costs within reasonable bounds
Inventory Management FUNS - correct answer ✔✔- To establish a system for tracking items in
inventory
- Make decisions about when and how much to order
, Inventory Management EFF REQ - correct answer ✔✔- A system keep track of inventory
- A reliable forecast of demand
- Knowledge of lead time and lead variability
- Reasonable estimates of: holding costs, ordering costs, shortage costs
- A classification system for inventory items
Periodic System - correct answer ✔✔Physical count of items in inventory made at periodic
intervals
Perpetual Inventory - correct answer ✔✔System that keeps track of removals from inventory
continuously, thus monitoring current levels of each item. An order is placed when inventory
drops to a predetermined minimum level.
Two-bin System - correct answer ✔✔Two containers of inventory; reorder when the first is
empty
Forecasts - correct answer ✔✔Inventories are necessary to satisfy customer demands, so it is
important to have a reliable estimates of the amount and timing of demand
Point-of-Sale (POS) Systems - correct answer ✔✔A system that electronically records actual
sales. This is helpful for enhancing forecasting and inventory management.
Lead Time - correct answer ✔✔Time interval between ordering and receiving the order
Purchase Cost - correct answer ✔✔The amount paid to buy the inventory
Holding (carrying) Costs - correct answer ✔✔Cost to carry an item in inventory for a length of
time, usually a year
