Inventory as Money

Pipeline inventory is expressed as :

• PI = L x D

• PI = D/2

• PI = L x 30 / 2

• PI = D x L / 2

Which is NOT a disposal method of dead stock?

• sell at a loss to employees

   

• Discounted price

• auction sale

• donating to charity

If the formula of ending inventory is rewritten to arrive at the formula of COGS, the resulting formula is

• CGS = Purchases + Beginning Inventory

• CGS = Beginning Inventory – Ending Inventory

• CGS = Ending Inventory + Beginning Inventory – Purchases

• CGS = Beginning Inventory + Purchases – Ending Inventory

Which is NOT the reason why some obsolete stock are still maintained?

• expectation of future sale

• Already paid

• expectation of usefulness

• expectation of increased value

Which inventory valuation method is used for companies with products that are either personalized or that their computer systems are sophisticated?

• FIFO

• LIFO

• Average Cost

• Specific Cost

This is the difference between the selling price and the price actually sold.

• Margin

• Markup

• Markdown

• Return

What type of inventory is a birthday candle in Red Ribbon?

• Raw materials

• work-in-process

• consumables

• buffer

Which is NOT a disadvantage of buffer inventory?

• Perishables could result in losses

• It results to opportunity loss

• Extra inventory occupies additional space

• It beef up overhead costs

One of the purpose of keeping inventory is to have a steady supply to meet orders.

• lower ordering costs

• price protection

• Predictability

• fluctuations in demand

The most important ratio for inventory is

• Profit Margin Ratio

• Quick Ratio

• Current Ratio

• Turnover Ratio