RCS Inventory & Supply Management 2 — Questions and Answers
Question 1: What is the primary purpose of establishing a par level for cleaning supplies?
- To track employee usage habits
- To set the minimum quantity that triggers a reorder (Correct answer)
- To calculate the total annual supply budget
- To determine the maximum storage capacity
Correct answer: To set the minimum quantity that triggers a reorder
A par level defines the minimum stock quantity at which a reorder must be placed to prevent running out of essential supplies.
Question 2: A residential cleaning company notices that microfiber cloths are being used at twice the expected rate. What is the BEST first step?
- Immediately order double the normal quantity
- Audit usage to determine if waste or theft is occurring (Correct answer)
- Switch to a cheaper alternative cloth
- Reduce the cleaning schedule to conserve supplies
Correct answer: Audit usage to determine if waste or theft is occurring
An audit identifies whether excess usage stems from waste, loss, or theft before making procurement decisions.
Question 3: Which inventory method values remaining stock at the most recently purchased price?
- FIFO (First In, First Out)
- LIFO (Last In, First Out) (Correct answer)
- Weighted average cost
- Specific identification
Correct answer: LIFO (Last In, First Out)
LIFO assigns the cost of the most recently purchased inventory to goods sold or used first.
Question 4: When storing concentrated cleaning chemicals alongside diluted ready-to-use products, what is a critical safety requirement?
- Store concentrates at room temperature only
- Keep concentrates and diluted products in clearly labeled, separate sections (Correct answer)
- Mix concentrates with diluted products to save space
- Store all chemicals in the same unlabeled container for convenience
Correct answer: Keep concentrates and diluted products in clearly labeled, separate sections
Separating and clearly labeling concentrates from diluted products prevents accidental misuse and dangerous over-concentration.
Question 5: A cleaning business uses 50 mop heads per month. Lead time from the supplier is 2 weeks. What is the minimum reorder point (assuming no safety stock)?
- 25 mop heads (Correct answer)
- 50 mop heads
- 75 mop heads
- 100 mop heads
Correct answer: 25 mop heads
With a 2-week lead time and 50 units/month usage, reorder when stock hits 25 (half a month's supply).
Question 6: What does 'dead stock' mean in a cleaning supply context?
- Chemicals that have expired and must be disposed of
- Inventory that is not moving and has no foreseeable use (Correct answer)
- Stock that has been quarantined due to contamination
- Supplies reserved for emergency use only
Correct answer: Inventory that is not moving and has no foreseeable use
Dead stock refers to inventory that is not being used or sold and ties up capital without providing value.
Question 7: Which document formally records the transfer of supplies from a central warehouse to a cleaning crew's vehicle?
- Purchase order
- Material transfer requisition (Correct answer)
- Vendor invoice
- Accounts payable statement
Correct answer: Material transfer requisition
A material transfer requisition documents internal movement of stock between locations or departments.
RCS Inventory & Supply Management 2
What is the primary purpose of establishing a par level for cleaning supplies?