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    MCQ On Inventory Management

    Uploaded by

    Sugumar
    This document contains 10 multiple choice questions about inventory management concepts. The key concepts covered include: - Inventory includes raw materials and finished products but not machines or consumable tools. - Important costs in inventory decisions are ordering costs, carrying costs, and shortage costs but not machining costs. - Inventory carrying costs include costs of insurance and taxes. - Buffer stock refers to the minimum stock level that should not fall below. - The economic order quantity balances ordering and carrying costs to minimize total costs.

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    © All Rights Reserved
    Download as PDF, TXT or read online from Scribd

    MCQ On Inventory Management

    Uploaded by

    Sugumar
    2K views3 pages
    This document contains 10 multiple choice questions about inventory management concepts. The key concepts covered include: - Inventory includes raw materials and finished products but not machines or consumable tools. - Important costs in inventory decisions are ordering costs, carrying costs, and shortage costs but not machining costs. - Inventory carrying costs include costs of insurance and taxes. - Buffer stock refers to the minimum stock level that should not fall below. - The economic order quantity balances ordering and carrying costs to minimize total costs.

    Original Description:

    Inventory management mcq

    Original Title

    mcq-on-inventory-management

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    This document contains 10 multiple choice questions about inventory management concepts. The key concepts covered include: - Inventory includes raw materials and finished products but not machines or consumable tools. - Important costs in inventory decisions are ordering costs, carrying costs, and shortage costs but not machining costs. - Inventory carrying costs include costs of insurance and taxes. - Buffer stock refers to the minimum stock level that should not fall below. - The economic order quantity balances ordering and carrying costs to minimize total costs.

    Copyright:

    © All Rights Reserved
    Download as PDF, TXT or read online from Scribd
    Download as pdf or txt
    2K views3 pages

    MCQ On Inventory Management

    Uploaded by

    Sugumar
    This document contains 10 multiple choice questions about inventory management concepts. The key concepts covered include: - Inventory includes raw materials and finished products but not machines or consumable tools. - Important costs in inventory decisions are ordering costs, carrying costs, and shortage costs but not machining costs. - Inventory carrying costs include costs of insurance and taxes. - Buffer stock refers to the minimum stock level that should not fall below. - The economic order quantity balances ordering and carrying costs to minimize total costs.

    Copyright:

    © All Rights Reserved
    Download as PDF, TXT or read online from Scribd
    Download as pdf or txt
    of 3

    For More Questions Click Here

    1. Which of the following is not an inventory?

    a. Machines
    b. Raw material
    c. Finished products
    d. Consumable tools

    (Ans:a)

    2. The following classes of costs are usually involved in inventory decisions


    except

    a. Cost of ordering
    b. Carrying cost
    c. Cost of shortages
    d. Machining cost

    (Ans:d)

    3. The cost of insurance and taxes are included in

    a. Cost of ordering
    b. Set up cost
    c. Inventory carrying cost
    d. Cost of shortages

    (Ans:c)

    4. ‘Buffer stock’ is the level of stock

    a. Half of the actual stock


    b. At which the ordering process should start
    c. Minimum stock level below which actual stock should not fall
    d. Maximum stock in inventory

    (Ans:c)

    5. The minimum stock level is calculated as

    a. Reorder level – (Nornal consumption x Normal delivery time)


    b. Reorder level + (Nornal consumption x Normal delivery time)
    c. (Reorder level + Nornal consumption) x Normal delivery time
    d. (Reorder level + Nornal consumption) / Normal delivery time

    (Ans:a)

    6. Which of the following is true for Inventory control?

    a. Economic order quantity has minimum total cost per order


    b. Inventory carrying costs increases with quantity per order
    c. Ordering cost decreases with lo size
    d. All of the above

    (Ans:d)

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

    a. Lead time
    b. Carrying time
    c. Shortage time
    d. Over time

    (Ans:a)

    8. Re-ordering level is calculated as

    a. Maximum consumption rate x Maximum re-order period


    b. Minimum consumption rate x Minimum re-order period
    c. Maximum consumption rate x Minimum re-order period
    d. Minimum consumption rate x Maximum re-order period

    (Ans:a)

    9. Average stock level can be calculated as

    a. Minimum stock level + ½ of Re-order level


    b. Maximum stock level + ½ of Re-order level
    c. Minimum stock level + 1/3 of Re-order level
    d. Maximum stock level + 1/3 of Re-order level

    (Ans:a)

    10. The Economic Order Quantity (EOQ) is calculated as


    a. (2D*S/h)^1/2
    b. (DS*/h)^1/2
    c. (D*S/2h)^1/2
    d. (D*S/3h)^1/2

    Where, D=Annual demand (units), S=Cost per order, h=Annual carrying cost per unit

    (Ans:a)

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