GFS part 9

Non-inventoried service transactions include billings for:

• PPE’s
• Service centers, IT licenses, Foreign Service Employees (FSEs) laboratory costs and license fees
• Bonds and stocks

Which accounts should be used to record non-inventoriable support services in source of supply entity:

• dr – 1260000 - Intercompany Accounts Receivable, cr - 8131000 - Intercompany Support Services Income
• dr - 1260000 - Intercompany Accounts Receivable, cr – 6050000 – Intercompany Revenue
• dr – 14X0000 – Inventory, cr – 3260000 – Intercompany Payables.

When product is drop shipped to a third-party customer, the purchasing subsidiary must generate the third-party invoice in accordance with the customer agreement. This must be:

• After the inter-company invoice has been generated
• After the product has been physically shipped
• Both answers are correct

How often the reconciliation on inventory needs to be carried out:

• At least monthly
• At least quarterly
• Annually

What is materiality level of root cause analysis for inventory reconciliation:

• It can’t exceed 5k USD
• It can’t exceed 15k USD
• It can’t exceed 50k USD

Which are 3 levels of inventory reconciliations:

• Inventory verification -> Quality reconciliation -> Value Reconciliation
• Inventory verification -> Quantity reconciliation - > Value Reconciliation
• Quality verification -> Quantity reconciliation -> Value reconciliation

What are characteristics of Pick to Zero (PTZ) inventory verification methodology:

• Minimum requirement. Counts all slots as a "one time" event.
• Counts all slots an equal number of times throughout the year. This may be twice, three times or four times. Ongoing activity throughout the year with a dedicated team.
• Verifies slots which are depleted to zero quantity and asks for confirmation. Requires a supplemental physical verification of those slots not picked to zero during the required for time period

Special counts are any supplemental inventory counts performed in addition to the normal annual verification plan. They might be:

• Required because acceptable inventory accuracy results
• Requested by management to confirm inventory on hand where there are operational concerns about the accuracy of inventory balances
• Both answers are correct

It is in 3M company intention to measure to weight “Hard to Measure Items” due to:

• Safety issues around physical access to the material
• Environmental and worker safety concerns related to the physical properties of the material (hazard, stability etc)
• Both answers are false There is no intention to weight “Hard to Measure Items”

Acceptable cycle count methods include:

• Traditional cycle count
• Pick to Zero (restricted use)
• Both answers are correct