1. Which of the following stock types can be counted through Physical Inventory procedure?(more than one answer can be correct) A. Unrestricted use stock. B. Block stock. C. Quality Inspection stock. D. Vendor consignment stock. E. In-transit stock. 2. Which of the following can possibly influence the valuation price of a moving average priced material? A. Goods receipt for a purchase order. B. Goods Issue to a cost centre. C. Invoice verification against a purchase order. D. Stock transfer between two storage locations in the same plant. E. All the above 3. In the SAP system a user can operate in the following hierarchies. A. Service level. B. Application level C. Main menu level. D. Month. E. Total stock value. 4. Your planning department is using a Forecast Model for materials planning. It has been established that while demand for the particular material is projected to increase steadily as
Transcript
1. Which of the following stock types can be counted through Physical Inventory
procedure?(more than one answer can be correct)
A. Unrestricted use stock.
B. Block stock.
C. Quality Inspection stock.
D. Vendor consignment stock.
E. In-transit stock.
2. Which of the following can possibly influence the valuation price of a moving average priced
material?
A. Goods receipt for a purchase order.
B. Goods Issue to a cost centre.
C. Invoice verification against a purchase order.
D. Stock transfer between two storage locations in the same plant.
E. All the above
3. In the SAP system a user can operate in the following hierarchies.
A. Service level.
B. Application level
C. Main menu level.
D. Month.
E. Total stock value.
4. Your planning department is using a Forecast Model for materials planning. It has been
established that while demand for the particular material is projected to increase steadily as
market share is increased, the fluctuating tourist demand will affect the overall requirements.
Which forecast model will best address this requirement?
A. The Constant model.
B. The Constant trend model.
C. The Seasonal trend model.
D. The Fluctuating trend model.
E.The Seasonal model.
5. In the SAP system, the reference document used in the purchasing cycle is the:
A. Purchase requisition.
B. Info record.
C. Source list.
D. Purchase Order.
E. None of the above.
6. What purpose does invoice verification serve in materials management?
a. It allows invoice that do not originate in materials procurement to be processed.
b. Completes the materials procurement process
c. Handles the payment
d. Allows credit memos to be processed
e. Handles the analyses of invoices.
7. What are the tasks of invoice verification?
a. Entering invoices and credit memos received.
b. Checking the accuracy of invoices
c. Executing the account posting resulting from invoice
d. Updating open items and material prices
e. Checking invoices that were blocked.
8. What is the process of invoice verification?
a. Purchase order, service or GR referenced for incoming invoice.
b. Invoice items suggested by the system against referenced document
c. Corresponding automatic account postings carried out.
d. Payment proposal list for vendor generated.
9. From where does the system pick the default quantity of an item when you post invoice
receipt?
a. Invoice
b. Purchase order
c. Purchase order history
d. System settings
e. Vendor master
10. During invoice verification the system picks the rate at which tax is calculated from the
vendor master record.
a. TRUE
b. FALSE
Answer of Mcq
1. a, b, c, d
2. a, c
3. d, e
4. c
5. d
6. b
7. a, b, c, e
8. a
9. c
10. False
11. the list of quantities of components, ingredients, and materials required to produce a product
is the
a. master schedule.
b. bill-of-materials.
c. purchase order.
d. engineering change notice.
12. ____________ allows a segment of the master schedule to be designated as "not to be
rescheduled."
a. Time fence
b. Regenerative MRP
c. Pegging
d. System nervousness
13. A lot-sizing technique that generates exactly what was required to meet the plan is
a. the Wagner-Whitin algorithm.
b. economic order quantity.
c. part period balancing.
d. lot-for-lot.
14. Breaking up the order and running part of it ahead of schedule is known as
a. lot splitting.
b. operations splitting.
c. overlapping.
d. pegging.
15. The difference between a gross material requirements plan (gross MRP) and a net material
requirements plan (net MRP) is
a. the gross MRP includes consideration of the inventory on hand, whereas the net MRP
does not.
b. the net MRP includes consideration of the inventory on hand, whereas the gross MRP
does not.
c. the gross MRP may not be computerized, but the net MRP must be computerized.
d. the gross MRP doesn't take taxes into account, whereas the net MRP includes the tax
considerations.
16. A phantom bill-of-materials is a bill-of-materials developed for
a. a module that is a major component of a final product.
b. the purpose of grouping subassemblies when we wish to issue "kits" for later use.
c. a subassembly that exists only temporarily.
d. a final product for which production is to be discontinued.
17. Which of the following lot-sizing techniques is likely to prove the most complex to use?
a. economic order quantity (EOQ)
b. lot-for-lot
c. part period balancing (PPB)
d. the Wagner-Whitin algorithm
18. When a bill-of-materials is used in order to assign an artificial parent to a bill-of-materials, it
is usually called a
a. planning bill-of-materials.
b. phantom bill-of-materials.
c. modular bill-of-materials.
d. pick list.
19. The operations manager has several tools available to deal with MRP system nervousness.
Those tools are
a. time fences and pegging.
b. buckets with back flush.
c. net and gross requirements.
d. pseudo bills and kits.
20. An MRP system that provides feedback to the capacity plan, master production schedule, and
production plans is called
a. system nervousness.
b. load report.
c. lot-sizing.
d. closed-loop MRP.
21. A time-phased stock-replenishment plan for all levels of a supply chain is called
a. MRP.
b. ERP.
c. MRP II.
d. DRP.
22. Which of the following is an advantage of ERP?
a. Is simple enough that companies have an easy time adjusting to it
b. Requires major changes to the company and its processes
c. Is very inexpensive to purchase
d. Creates commonality of databases
Answer of Mcq
11. b
12. b
13. d
14. a
15. a
16. c
17. a
18 c
19. d
20. a
21. d
22. c
23. MRP stands for:
a. Manufacturing Resource Planning
b. Master Resources Production
c. Management Reaction Planning
d. Materials Requirements Planning
24. MPS stands for:
a. Master Planning System
b. Material Planning System
c. Master Production Schedule
d. Material Production Schedule
25. Closed Loop MRP means:
a. Unused materials are returned to stores and recorded back into the system
b. Actual sales are netted off the forecasts in the MPS
c. Capacity and resource planning is included in the MRP logic
d. Actual inventory is counted regularly and adjustment made to the inventory records
26. Optimized production technology (OPT) is a computer-based technique and tool which helps
to schedule production systems. Which of the following are not principles of OPT?
a. Capacity is “king”
b. Bottlenecks govern throughput
c. Balance flow is what is required
d. Process batch should be variable
27. Enterprise Resource Planning (ERP) has been criticised on a number of grounds. Which of
the following is not a common criticism of ERP?
a. The effect it has on businesses is disappointing
b. It can have a disruptive effect on the organization’s operations
c. It doesn’t allow decisions and databases from all parts of the organisation to be integrated
d. Implementation is expensive
28. In MRP (Materials Requirements Planning) the Bill of Materials is:
a. A list of required safety stock items
b. The required output from a process over time
c. The sum of stock-on-hand and work-in-progress
d. The difference between planned receipts and current stocks
e. The product structure showing where common parts are used
29. The outputs of a MRP II system are:
a. Master Production Schedule / capacity requirement plans / stock locations
b. Sales order priorities / Bills of Materials / Material Requirement Plans
c. Material Requirement Plans / scheduled purchase orders / capacity requirement plans
d. Capacity requirement plans / stock quantities / stock locations
e. Stock quantities / Bills of Materials / Master Production Schedule
30. Three inputs for every MRP system are:
a. Master Production Schedule, Bill of Materials, sales forecast
b. Bill of Materials, sales forecast, sales history
c. Sales forecast, delivery costs, capacity plan
d. Average replenishment time; re-order point, economic order quantity
e. Stock on hand, Master Production Schedule, Bill of Materials
Answer of Mcq
23. a
24. a
25. a
26. a
27. a
28. d
29. d
30. d
31. He principal files that are incorporated into a computerized MRP system are:
a. inventory record, master schedule, BOM.
b. inventory record, master file, part-period balancing program.
c. send items, components, and load reports.
d. capacity requirements planning file, master schedule, inventory record.
e. MRP computer program, master schedule, capacity requirements planning file.
32. Which of the following statements concerning the level of assembly is correct?
a. Gross requirements are derived from the planned-order releases at the next higher level.
b. Gross requirements are derived from the planned-order releases at the next lower level.
c. Gross requirements are derived from the planned-order receipts at the next higher level.
d. Gross requirements are derived from the planned-order receipts at the next lower level.
e. None of the above is correct.
33. Which one relates to minimal changes allowed to a master schedule?
a. safety stock.
b. safety time.
c. lead time.
d. time fence
34. Linking a part with a specific parent is referred to as:
a. lot sizing.
b. pegging.
c. kanban.
d. capacity planning.
e. leveling.
35. A list of all parts and materials needed to assemble one unit of a product is called:
a. a master schedule.
b. a kanban.
c. an inventory record file.
d. MRP.
e. a bill of materials.
36. Which phrase or term is most clearly associated with the acronym BOM?
a. Master schedule
b. Net requirements
c. Scheduled receipts
d. Product-structure tree
e. Inventory record file
37. Which of the following correctly describes the computation of net requirements?
a. Gross requirements - Scheduled receipts
b. Gross requirements - On hand + Scheduled receipts
c. Gross requirements - Scheduled receipts - On hand
d. Gross requirements - Scheduled receipts + Planned order receipts
38. Which of these has the broadest scope and the most costly to implement?
a. MRP
b. MRPII
c. ERP
39. Pick the false statement about ERP vendors.
a. They have been slow to develop offerings related to e-commerce.
b. They have a huge installed base of customers.
c. They are now shifting gears to develop applications for good electronic commerce
websites.
d. They have a virtual stranglehold on "back-office" functions such as order fulfillment.
Answer of Mcq
31. a
32. a
33. d
34. b
35. e
36. d
37. c
38. c
39. c
40. Decisions relating to production scheduling involve:
a. short-term forecasting.
b. medium-term forecasting.
c. long-term forecasting.
d. both short-term as well as medium-term forecasting
e. both short-term, medium-term and long-term forecasting
41. Decisions relating to the sales and operations planning (aggregate planning) involve:
a. Short-term forecasting.
b. Medium-term forecasting.
c. Long-term forecasting.
d. both short-term and medium-term forecasting
e. both short-term, medium-term and long-term forecasting
42. Which one of the following does not fall under qualitative forecasting method?
a. Life cycle analogy
b. Market research
c. Judgmental methods
d. Delphi method
e. Moving average methods
43. For which of the following situation(s) is the market research method of forecasting suitable?
a. When a firm is working with stable technology
b. When a firm is planning moderate changes on product innovations
c. When a firm is market testing one of its new offerings
d. When a firm is working with stable technology, planning moderate changes on product
innovations or market testing one of its new offerings.
e. when a firm is planning moderate changes on product innovations and market testing
one of its new offerings
44. Which of the following forecasting method is suitable for launching new products?
a. Judgmental methods
b. Exponential smoothing
c. Moving average methods
d. Causal models
e. Market research
45. Which of the following method(s) is(are) suitable for forecasting the demand of a product?
a. Delphi method
b. Market research
c. Judgmental methods
d. Delphi method and judgmental method
e. Market research and judgmental method
46. What is the measure of forecast error which calculates the average forecast error over n time
periods known as?
a. Mean error
b. Mean absolute deviation
c. Mean-square error
d. Mean absolute percentage error
47. The measure of forecast error which calculates the average of absolute differences between
the actual and the forecast demand over n time periods is known as:
a. mean absolute percentage error
b. mean error
c. mean-square error
d. mean absolute deviation
48. The measure of forecast error which calculates the average of square of the forecast errors is
known as:
a. mean-square error
b. mean error
c. mean absolute deviation
d. mean absolute percentage error
49. The measure of forecast error which calculates the average of absolute forecast errors as a
percentage of the actual demand is known as:
a. mean-square error
b. mean absolute deviation
c. mean error
d. mean absolute percentage error
Answer of Mcq
40. a
41. b
42. c
43. d
44. a
45. d
46. d
47. c
48. d
49. a
50. Which one of the following is not included in the 5 R in purchasing?
a) Quality
b) Quantity
c) Price
d) None of these
51. Which of the following is not a function of purchasing management?
a) Selecting the source
b) Placement of purchase order
b) Physical controls of material
d) None of these
52. The purchase order form is designed by
a) Materials Manager
b) Purchase Manager
b) Marketing Manager
d) None of them
53. The objective(s) of forward purchasing is / are
a) To guard against interruption in supply
b) To economize the use of storage space
c) To guard against the future rise in price
d) All of these
54. JIT contributed to the
a) Reduced inventories and WIP
b) Reduced suppliers and vendors
c) Reduced information flows
d) Reduced manpower planning
55. “Hedging” technique is used
a) When there is an organized commodity market
b) Where large quantities of a particular commodity are bought and sold
c) Both (a) and (b)
d) None of these
56. Purchase Budget has an impact on
a) Profitability of the company
b) Materials Budget of the company
c) Bill of materials
d) All of these
57. Right quality means
a) over specifying the quality standards for purchasers
b) under specifying the quality for purchasing
c) buying standard items
d) Buying quality which suits the needs without incurring extra cost to the company
58. Purchase order is a legal binding contract only if it is
a) accepted by the supplier
b) acknowledged by the supplier
b) posted by the buyer
d) none of these
59. JIT is a concept which means
a) Japanese language
b) Making a plan from time to time
c) Getting the items just when they are needed for production
d) Raising purchase order just before delivery.
60. The type of purchasing where the purchaser tries to protect himself by entering into two
transactions – a purchase and a sale contacts in two markets whose prices fluctuate is known as
a) Speculative Buying
b) Forward Buying
b) Hedging
d) Blanket order
61. The parameters for vendor rating include
a) Price
b) Service
b) Delivery
d) All of these
62. The type of purchasing where the purchaser tries to protect himself by entering into 2
transactions – a purchase and a sale contacts in two markets whose prices fluctuate is known as
a) hedging
b) speculative buying
c) forward buying
d) blanket order
63. The document prepared on receipt of materials in store is known as
a) MRN
b) GRN
c) Challan
d) Bill of materials.
64. The system of purchasing from one’s customer preferred to others is known as
a) Forward Buying
b) Tender Buying
c) Reciprocal Buying
d) Blanket Order
65. A stipulation in a contract of sale pertaining to goods which is essential to the main purpose
of the contract is called
a) Rejection
b) Warranty
c) Acceptance
d) Condition.
66. When the contract of agency is in writing it is called
a) Law of agency
b) Qui facit peractum facit per se
c) Power of Attorney
d) none of these.
67. An arrangement whereby the obligation to pay an exporter is undertaken by a bank is called
a) Bill of Landing
b) Letter of Credit
c) International Credit
d) Hundi.
68. The type of buying most suitable for C strategy of items of inventory is
a) Forward Buying
b) Tender Buying
c) Blanket Order
d) Systems Contract.
Answer of Mcq
50. d
51. d
52. b
53. a
54. a
55. c
56. d
57. d
58. a
59. c
60. c
61. d
62. d
63. c
64. c
65. d
66. c
67. b
68. c
69. A firm's inventory turnover (IT) is 5 times on a cost of goods sold (COGS) of $800,000. If
the IT isimproved to 8 times while the COGS remains the same, a substantial amount of funds is
released fromor additionally invested in inventory. In fact
a. $160,000 is released
b. $100,000 is additionally invested.
c. $60,000 is additionally invested.
d. $60,000 is released.
70. Ninety-percent of Vogel Bird Seed's total sales of $600,000 is on credit. If its year-end
receivables turnover is 5, the average collection period (based on a 365-day year) and the year-
end receivable share, respectively:
a. 365 days and $108,000.
b. 73 days and $120,000.
c. 73 days and $108,000.
d. 81 days and $108,000.
71. If EOQ = 360 units, order costs are $5 per order, and carrying costs are $.20 per unit, what
is the usage in units?
a. 129,600 units
b. 2,592 units
c. 25,920 units
d. 18,720 units
72. Costs of not carrying enough inventory include:
a. lost sales.
b. customer disappointment.
c. possible worker layoffs.
d. all of these.
73. Which of the following relationships hold true for safety stock?
a. the greater the risk of running out of stock, the smaller the safety of stock.
b. the larger the opportunity cost of the funds invested in inventory, the larger the safety stock.
c. the greater the uncertainty associated with forecasted demand, the smaller the safety stock.
d. the higher the profit margin per unit, the higher the safety stock necessary.
74. Increasing the credit period from 30 to 60 days, in response to a similar action taken by all
of our competitors, would likely result in:
a. An increase in the average collection period.
b. A decrease in bad debt losses.
c. An increase in sales.
d. Higher profits.
75. Complete the MRP spreadsheet below for a component which is ordered in varying
quantities over weeks 1 – 7. Which answer correctly gives the X’s?
