CRP Inventory & Supply Management 2 — Questions and Answers
Question 1: What does the term 'par level' mean in restaurant inventory management?
- The minimum stock quantity needed to meet demand between deliveries (Correct answer)
- The maximum amount of a product ever ordered at one time
- The average cost of goods sold per week
- The reorder point set by the supplier
Correct answer: The minimum stock quantity needed to meet demand between deliveries
Par level is the minimum quantity of an item that must be on hand to cover demand until the next delivery.
Question 2: A restaurant uses the FIFO method. Which product should be used first?
- The item with the earliest expiration date (Correct answer)
- The item most recently received
- The item with the highest cost
- The item stored at the back of the shelf
Correct answer: The item with the earliest expiration date
FIFO (First In, First Out) requires using the oldest stock first to prevent spoilage and waste.
Question 3: Which metric best measures how efficiently a restaurant turns over its inventory?
- Inventory turnover ratio (Correct answer)
- Food cost percentage
- Prime cost ratio
- Gross profit margin
Correct answer: Inventory turnover ratio
The inventory turnover ratio measures how many times inventory is sold and replaced in a given period.
Question 4: A vendor offers a 5% discount for orders above $2,000. This type of pricing is called:
- Volume discount pricing (Correct answer)
- Cost-plus pricing
- Competitive pricing
- Penetration pricing
Correct answer: Volume discount pricing
Volume discounts reward buyers who purchase larger quantities, reducing per-unit cost.
Question 5: What is a 'standing order' in restaurant supply management?
- A recurring automatic delivery of set quantities on a scheduled basis (Correct answer)
- A one-time bulk purchase made at the start of the season
- An order placed only when stock reaches zero
- A special order for custom or unique items
Correct answer: A recurring automatic delivery of set quantities on a scheduled basis
Standing orders automate routine deliveries of items needed consistently, reducing ordering workload.
Question 6: When a delivery arrives, the receiving manager should FIRST:
- Check the delivery against the purchase order for accuracy (Correct answer)
- Sign the invoice immediately to avoid delays
- Move all items to storage as quickly as possible
- Check the supplier's credit terms
Correct answer: Check the delivery against the purchase order for accuracy
Verifying the delivery against the purchase order ensures the correct items and quantities were received before signing.
Question 7: Which of the following is an example of a perishable inventory control challenge?
- Managing short shelf-life items to minimize spoilage (Correct answer)
- Storing canned goods in a warm dry area
- Tracking silverware counts weekly
- Negotiating long payment terms with suppliers
Correct answer: Managing short shelf-life items to minimize spoilage
Perishables require careful rotation, temperature control, and usage planning to avoid spoilage losses.
CRP Inventory & Supply Management 2
What does the term 'par level' mean in restaurant inventory management?