CLTD Logistics Costing and Finance 3

Question 1

Which capital budgeting technique calculates the present value of all future cash flows from a logistics investment minus the initial cost, to assess whether the investment adds value?

Accepted Answer

Net present value (NPV)

Answer

Payback period

Answer

Internal rate of return (IRR)

Answer

Accounting rate of return (ARR)

Question 2

In logistics costing, 'detention' charges are incurred when:

Accepted Answer

A carrier's trailer or container is held beyond the contractually agreed free time at a shipper or receiver's facility

Answer

A shipment is lost in transit

Answer

Freight is damaged during loading

Answer

A carrier fails to meet on-time delivery metrics

Question 3

The term 'cube utilization' in warehousing finance refers to:

Accepted Answer

The ratio of actual storage volume used to the total available cubic storage capacity

Answer

The percentage of warehouse staff actively picking orders

Answer

The square footage cost per pallet position

Answer

The number of product SKUs stored per aisle

Question 4

Which of the following is an example of a variable logistics cost?

Accepted Answer

Fuel costs that increase with miles driven

Answer

Annual warehouse lease payment

Answer

Depreciation on a fleet of owned trucks

Answer

Fixed salary of the logistics manager

Question 5

A 'shipper of choice' program primarily benefits a company by:

Accepted Answer

Securing preferred carrier capacity and better rates by providing consistent, easy-to-handle freight and reliable volumes

Answer

Eliminating the need to negotiate freight rates

Answer

Allowing shippers to set their own freight tariffs

Answer

Reducing regulatory compliance obligations

Question 6

When comparing logistics outsourcing to in-house operations, which cost is most often underestimated in total cost of ownership (TCO) calculations?

Accepted Answer

Hidden costs such as management oversight, transition expenses, and service failure risk

Answer

Direct labor wages

Answer

Carrier line-haul rates

Answer

Fuel surcharge percentages

Question 7

In supply chain finance, 'supply chain financing' (or reverse factoring) primarily helps:

Accepted Answer

Buyers extend payment terms while allowing suppliers to receive early payment at favorable rates from a financial institution

Answer

Carriers reduce empty miles on return trips

Answer

Shippers avoid customs duties on imported goods

Answer

Warehouses reduce seasonal labor costs