Materials Flashcards
7 cards from real ERP practice questions. Tap to flip, then mark Knew It or Still Learning — missed cards come back until you master them.
Read the first 7 Materials flashcards as text
What is 'vendor managed inventory (VMI)' in the context of ERP materials management?
Answer: An arrangement where the supplier monitors stock levels and replenishes inventory automatically
In VMI, the supplier takes responsibility for monitoring inventory levels at the customer's location and triggering replenishment, often enabled by ERP data sharing.
Which ERP feature prevents a purchase order from being processed for payment if the received quantity significantly differs from the invoiced quantity?
Answer: Quantity tolerance check in three-way match
Three-way match compares PO, goods receipt, and invoice quantities, and tolerance limits flag or block invoices where the received quantity deviates beyond the allowed variance.
What is 'dead stock' in inventory management?
Answer: Stock that has not moved in a defined period and is unlikely to be used or sold
Dead stock refers to inventory items that have had no movement (no receipts or issues) for a defined time period and represent tied-up capital with low utilization.
In ERP production planning, what is a 'bill of materials (BOM)'?
Answer: A structured list of components and quantities required to produce a finished product
A BOM defines every component, subassembly, and raw material—along with required quantities—needed to manufacture one unit of a finished or semi-finished product.
What does 'back-flushing' mean in ERP materials management?
Answer: Automatically posting material consumption when production output is confirmed, without manual goods issues
Back-flushing (also called post-deduct or auto-goods-issue) automatically deducts component quantities from inventory at the time production output is confirmed.
Which ERP functionality allows a company to evaluate vendors based on quality, delivery performance, and price compliance over time?
Answer: Vendor evaluation (supplier scorecard) module
Vendor evaluation modules score suppliers across weighted criteria such as on-time delivery, invoice accuracy, and material quality to support sourcing decisions.
What is a 'split valuation' in ERP inventory management?
Answer: Maintaining separate stock and valuation data for different categories of the same material (e.g., new vs. refurbished)
Split valuation allows a single material to carry different prices and stock balances based on a defined category (valuation type) such as origin, batch status, or condition.