CPPB Inventory Management 2

Question 1

Which inventory control technique establishes a maximum and minimum level between which stock is maintained?

Accepted Answer

Min-Max System

Answer

ABC Analysis

Answer

Just-in-Time (JIT)

Answer

Economic Order Quantity (EOQ)

Question 2

A physical inventory count that covers the entire warehouse at one time is referred to as a:

Accepted Answer

Wall-to-wall inventory

Answer

Cycle count

Answer

Spot check

Answer

Audit sampling

Question 3

Cycle counting differs from a full physical inventory in that cycle counting:

Accepted Answer

Counts a rotating subset of items on a continuous schedule throughout the year

Answer

Is performed only once per fiscal year

Answer

Requires operations to shut down during the count

Answer

Is used exclusively for high-value Class A items

Question 4

In public procurement inventory management, 'turnover rate' is best defined as:

Accepted Answer

The number of times average inventory is sold or used within a given period

Answer

The rate at which suppliers are replaced during a contract period

Answer

The percentage of items that expire before being used

Answer

The frequency of physical inventory counts in a year

Question 5

Which of the following is an example of a carrying (holding) cost in inventory management?

Accepted Answer

Warehouse space and insurance for stored goods

Answer

Cost of issuing a purchase order

Answer

Freight and shipping charges from the vendor

Answer

Price premium paid for rush delivery

Question 6

Just-in-Time (JIT) inventory management is primarily designed to:

Accepted Answer

Receive goods only as they are needed, minimizing on-hand inventory

Answer

Build large safety stock reserves to prevent stockouts

Answer

Consolidate all purchasing into a single annual contract

Answer

Automate purchase order generation using barcodes

Question 7

When a public agency uses a consignment inventory arrangement, ownership of goods transfers to the agency:

Accepted Answer

When the goods are drawn from stock and used

Answer

When the goods are received at the warehouse

Answer

When the vendor submits an invoice

Answer

When the contract is awarded to the vendor