Round 1

In the ABC Analysis system the B category stands for___.

• Outstanding importance in value

• Comparatively unimportant in value

• Comparatively important in value

• Average importance in value

The cost of insurance and taxes are included in

• Cost of ordering

• Set up cost

• Inventory carrying cost

• Cost of shortages

The time period between placing an order its receipt in stock is known as

• Lead time

• Carrying time

• Shortage time

• Over time

A method that uses a predetermined overhead rate to allocate overhead costs is known as ___.

• Plant-wide allocation

• Shipping allocation

• Department allocation

• Production-wide allocation

The demand rate for a particular item is 12000 units/year. The ordering cost is Rs.100 per order and the holding cost is Rs.0.80 per item per month. If no shortages are allowed and the replacement is instantaneous, then the economic order quantity is

• 1500 units

• 500 units

• 2000 units

• 1000 units

A company uses 2555 units of an item annually. Delivery lead time is 8 days. The reorder point (in number of units) to achieve optimum inventory is _____

• 7

• 8

• 56

• 60

The minimum stock level is calculated as

• Reorder level –  (Normal consumption x Normal delivery time)

• Reorder level + (Normal consumption x Normal delivery time)

• (Reorder level + Normal consumption) x Normal delivery time

• (Reorder level + Normal consumption) / Normal delivery time

The order cost per order of an inventory is Rs. 400 with an annual carrying cost of Rs. 10 per unit. The Economic Order Quantity (EOQ) for an annual demand of 2000 units is

• 400

• 440

• 480

• 500

If demand in units is 18000 relevant ordering cost for each year is $150 and an order quantity is 1500 then annual revant ordering cost would be

• $200

• $190

• $160

• $180

A statistical process control chart which shows the number of defects found in a subgroup of fixed size is

• C-chart

• R-chart

• Control chart

• Gantt chart