Deck 12: Physical Inventory and Warehouse Management

Question 1

In the________ , items are grouped by zone to make counting more efficient. The system is used when a fixed- location system is used or when WIP or transit inventory is being counted.

A) Location and audit system
B) zone method
C) periodic inventory count system
D) cycle counting system

Answer 1

zone method

Question 2

Identify the basic systems of locating stock?

Answer 2

The following are some basic systems of locating stock: group functionally related items together, group fast- moving items together, group physically similar items together, or locate working stock and reserve stock separately.

Question 3

In the________ , rather than handling individual orders, a number of orders are gathered together and all the items are divided by zone.

A) reserve stock system
B) area system
C) zone system
D) multi- order system

Answer 3

multi- order system

Question 4

Discuss the concerns of stock location or warehouse layout.

Question 5

Describe and define a floating location stocking or storage system for inventory.

Question 6

A company wants to store an SKU consisting of 13,000 cartons on pallets each containing 30 cartons. How many pallet positions are needed if the pallets are stored three high?

Question 7

Tolerances are set on individual items based on:

A) ability to stop production and safety problems
B) value and critical nature of the item
C) availability and lead time
D) all of the above

Question 8

The number of items an item is counted in a year is called its .

A) physical count
B) count frequency
C) cycle count
D) cycle frequency

Question 9

It is important to audit record accuracy, but it is important to audit the system to

A) eliminate the causes of record accuracy
B) find the causes of record inaccuracy
C) both A and B
D) neither A nor B

Question 10

An advantage to a point- of- use storage is:

A) central storage costs are increased
B) materials are only accessible to marketing
C) material handling is increased
D) material is accessible a all times

Question 11

A company has classified its inventory into ABC items. It has decided that A items are to be counted once a month; B items, four times a year; and C items, twice a year. There are 2000 A items, 3000 B items,a dn 5000 C items in inventory. Develop a schedule of counts for each class of item.

Question 12

Causes of inventory record error are:

A) unsecured stockroom
B) unauthorized withdrawal of material
C) poorly trained personnel
D) all of the above

Question 13

Which of the following items are within tolerance? What is the percent accuracy by item?

Question 14

What are the functions of warehouse management? Discuss.

Question 15

For physical control and security what is needed is a system that:

A) makes it difficult for people to make mistakes
B) makes it difficult for people to be dishonest
C) both A and B
D) neither A nor B

Question 16

Inaccurate inventory records will result in:

A) improved delivery performance
B) increased sales
C) higher productivity
D) shortages or excess inventory

Question 17

Determine which of the following items are within tolerance. Item A has a tolerance of +/- 5%; item B +/- 2%; item C +/- 3%; and item D =/- 0%.

Question 18

A special count is appropriate when:

A) an error is detected
B) there is an obvious error
C) there is a negative balance on the stock record
D) all of the above

Question 19

Discuss the efficient use of labor and equipment for warehouse activities.

Question 20

A company wants to store an SKU consisting of 5,000 cartons on pallets each containing 30 cartons. They are to be stored three high in the warehouse. How many pallet positions are needed?

Question 21

Major retailers like Wal-Mart see the value in using RFID as a way of gathering information and are demanding their use in many of their products.

Question 22

Because inventory is intangible, items have a habit of becoming lost or stolen.

Question 23

Bar codes are read using a laser light.

Question 24

The use of bar codes can increase transaction errors.

Question 25

To judge inventory accuracy, a tolerance level for each part must be specified.

Question 26

RFID works similar to bar codes but uses reflected radio waves to receive information.

Question 27

Cycle counting is a system of counting inventory once per year.

Question 28

Not only should the stores staff be well- trained in handling and storing material and in recording transactions, but other personnel who interact with stores must be trained to ensure transactions are recorded properly.

Question 29

The responsibility for taking the physical inventory usually rests with the marketing manager who should ensure that a good plan exists and is followed.

Question 30

Taking a physical inventory is a time- honored practice in many companies mainly because it has been required for an "accurate" appraisal of inventory value for the annual financial statements.