ABC analysis divides on-hand inventory into three dasses, generaly based upon a.
ID: 426740 • Letter: A
Question
ABC analysis divides on-hand inventory into three dasses, generaly based upon a. item quality b. unit price c. the number of units on hand d. annual demand e annual dollar valume 2. Cydle counting a. is a process by which inventory records are verified ance a year b. provides a measure of inventory accuracy c. provides a measure of inventory turnover d. assumes that al inventory records must be verified with the same e. assumes that the most frequenty used items must be counted more frequently 3. which of the following is not an assumption of the economic order quantty .D.S model shown below? e- a. Demand is known, constant, and independent. b. Tead time is known and constant C. Quantity discounts are nat posable d. Production and use can occur simultaneousy e. The only variable costs are setup cnst and holding (ar carrying) cost. 4. The primary purpose of the basic economic arder quantity model shown below is 2.D-S a. to caculate the reorder point, so that replenishments take place at the proper time b. to minimize the sum of carrying cost and holding cost c. to maximize the customer service level d. to minimize the sum of setup cost and holding cost e. to cakulate the optimum safety stock 5. If the actual order quantity s the economic order quantity in a that shown below, meets the assumptions of the economic order quantity model the average amount of inventory on hand a. is 50% af the ecoromic order quantity b, is the har sze the economic orde quantity c, is smaller the smaller is the halding cost per unit d. is affected by the amount of product cost f, c and d are correctExplanation / Answer
1.
E
The inventory is classified into the three categories based upon the dollar volume invested in the different inventory items.
2.
A
It is an auditing process.
3.
D
It is not an assumption under the EOQ model.
4.
D
At EOQ level, the sum of setup cost and holding cost is minimized.
5.
E
Average inventory = EOQ/2 or 50% of the EOQ