Inventory Management Quiz

What does inventory include?

• Only raw materials

• Raw materials, work-in-process goods, and completely finished goods

• Only finished goods

• Only work-in-process goods

What is the primary focus of inventory management?

• Reducing costs of production

• Specifying the shape and percentage of stocked goods

• Increasing sales revenue

• Managing employee productivity

Which of the following is NOT a reason for keeping an inventory?

• Time

• Uncertainty

• Economies of scale

• Employee training

What do inventory policies specify?

• The price at which goods should be sold

• Decision rules for when to replenish inventory and how much to order

• Employee roles in the supply chain

• Marketing strategies for products

What does Just in Time (JIT) aim to achieve?

• Increase storage space for inventory

• Improve return on investment by reducing in-process inventory and carrying costs

• Enhance customer service through faster delivery

• Maximize production output regardless of costs

What does procurement refer to?

• The process of selling products to customers

• The acquisition of goods or services

• The management of employee performance

• The distribution of products to retailers

What does a stockout mean?

• Having excess inventory on hand

• Running out of the inventory of an SKU (Stock Keeping Unit)

• A reduction in production capacity

• An increase in product demand