SGS Business 2.3.3 Managing Stock

Which option best describes the term, just in time (JIT) stock control?

• The stock which a business holds

• A diagram which shows business stock levels and usage over time

• A system whereby stock arrives only when it is needed by the business

• The minimum amount of stock that a business holds at any one time

Which option is a drawback to a business of using just in time (JIT) stock control?

• High insurance costs

• Stock could become out of date or obsolete

• Storage costs will be high

• Delays in deliveries could result in idle resources

Which business is most likely to operate a just in time (JIT) stock control

system?

• Car manufacturer

• Nationwide footwear retailer

• Wholesaler of building supplies

• School uniform retailer

Which of the following statements is true in relation to the bar gate stock graph?

• The business experienced a stock out in month one

• The maximum stock level the business wishes to hold is 4 cartridges

• The lead time for each delivery is always two months

• The re-order quantity in month two is 6 cartridges

On a bar gate stock graph, which of the following terms describes the size of an order that

is delivered to a business at a set moment in time?

• Maximum stock level

• Re-order quantity

• Minimum stock level

• Re-order level

Which option describes the time difference between a business ordering and receiving stock?

• Re-order quantity

• Lead time

• Buffer stock

• Re-order level

Which two are most likely to occur when a business introduces just in time (JIT) stock control?

• Lower stock holding

• An increase in obsolete stock

• More frequent deliveries

• A build-up of unsold stock

• Increased storage space is required

In a bar gate stock graph, what is the re-order level?

• The time at which new stock is ordered

• The amount of new stock that is ordered

• The amount of stock that leads to a new order being placed

• The time at which stock levels reach zero

Which of the following is most likely to be an advantage to a business of using just in time (JIT) stock control?

• Last minute orders can be met successfully

• Bulk buying of stock can lead to lower costs

• Improved cash flow

• Delays in the production process are less likely to occur

Which of the following best describes the term, buffer stock?

• The maximum amount of stock the business can physically hold

• The amount of stock that arrives in a new delivery

• The minimum amount of stock the business wishes to hold

• The amount of stock held when a new order is triggered