Supply Chain Management Warehousing 5

Question 1

Which inventory costing method assumes the most recently purchased items are the first to be sold?

Accepted Answer

LIFO

Answer

LIFO (Last In, First Out) assumes newer inventory is sold first, which can reduce taxable income during inflationary periods.

Question 2

What is a 'pick-to-light' system in warehouse operations?

Accepted Answer

LED displays mounted at storage locations that guide pickers to the correct bin and quantity

Answer

Pick-to-light uses illuminated displays at each bin location to direct pickers, reducing errors and improving speed.

Question 3

In a distribution center, what is the purpose of a 'sortation system'?

Accepted Answer

Automatically directing individual items or cartons to designated destinations or shipping lanes

Answer

Sortation conveyors automatically route individual units to the correct outbound lanes, shipping docks, or packing stations.

Question 4

What risk does excessive safety stock carry for a warehouse operation?

Accepted Answer

Higher carrying costs and potential obsolescence

Answer

While safety stock prevents stockouts, too much ties up capital in storage costs and risks product expiration or obsolescence.

Question 5

Which warehouse process involves inspecting inbound shipments for quantity, quality, and damage before storing them?

Accepted Answer

Receiving and putaway

Answer

Receiving and putaway includes verifying shipment accuracy and condition before products are moved to designated storage locations.

Supply Chain Management Practice Test