Inventory Management & Control Flashcards
7 cards from real CLT practice questions. Tap to flip, then mark Knew It or Still Learning — missed cards come back until you master them.
Read the first 7 Inventory Management & Control flashcards as text
A cycle count shows 47 units in a bin, but the WMS shows 50. What should the technician do first?
Answer: Recount the location to verify the discrepancy
Standard practice is to recount and verify before making any inventory adjustment.
Under ABC analysis, which items are usually counted most often?
Answer: A items, because they make up most of the annual dollar value
A items make up a small share of SKUs but most of the dollar value, so they get counted most often.
A pharmacy distributor ships the units with the earliest expiration date first, no matter when they arrived. Which method is this?
Answer: FEFO
FEFO (First Expired, First Out) ranks stock by expiration date, not by when it was received.
Daily demand is 20 units, lead time is 5 days, and safety stock is 30 units. What is the reorder point?
Answer: 130 units
Reorder point = (20 x 5) + 30 = 130 units.
Which inventory system updates on-hand balances in real time after every receipt and shipment?
Answer: Perpetual inventory system
A perpetual system updates records with every transaction, so balances are always current.
Inventory shrinkage is best described as:
Answer: Stock lost to theft, damage, or recording errors
Shrinkage is the gap between recorded and actual inventory caused by theft, damage, or errors.
Annual cost of goods sold is $600,000 and average inventory is $150,000. What is the inventory turnover ratio?
Answer: 4
Turnover = COGS / average inventory = 600,000 / 150,000 = 4.