Deck 12: Supply Chain Management and Logistics

Question 1

If an online retail store has cost of goods sold equal to $2 million, has 200 operating days in a year, and has a total average on-hand inventory of $500,000, the cost of goods sold per day is _____.

A) $2,500
B) $15,000
C) $7,500
D) $10,000

Answer 1

$10,000

Question 2

__________is inventory that has been ordered but is in transit.

A) Pipeline inventory
B) Decoupling inventory
C) Buffer inventory
D) Anticipation inventory

Answer 2

Pipeline inventory

Question 3

A(n)__________is any entity-real or virtual-that coordinates and shares information between buyers and sellers.

A) manufacturer
B) franchisor
C) intermediary
D) investor

Answer 3

intermediary

Question 4

Managing orders, transportation, and distribution to provide goods and services is part of the _____ function of the Supply Chain Operations Reference (SCOR) model.

A) plan
B) source
C) make
D) deliver

Question 5

TekSupply Inc., an automobile parts supplier, held an average automobile parts inventory of $4 million last year. Its cost of goods sold was $25 million. Therefore, the automobile parts experienced an inventory turnover of _____ turns last year.

A) 2.5
B) 4.25
C) 6.25
D) 9.5

Question 6

A high average inventory value reduces the chances of inventory obsolescence.

Question 7

Cash-to-cash conversion cycle is the average time to convert a dollar spent to acquire raw materials into a dollar collected for a finished good.

Question 8

Air shipments have the lowest transportation cost and can carry unlimited weight.

Question 9

The _____ function of a supply chain is responsible for selecting transportation carriers and managing company-owned fleets of vehicles.

A) integration
B) procurement
C) logistics
D) scheduling

Question 10

__________is the discipline of managing the flow of materials and transportation activities to ensure adequate customer service at reasonable cost.

A) Logistics
B) Scheduling
C) Procurement
D) Integration

Question 11

Electronic data interchange and Internet links decrease the velocity of supply chains.

Question 12

Which of the following best defines inventory turnover

A) It is the cost associated with repairs of goods that have been returned.
B) It is the time taken to fill a customer's order.
C) It is a measure of how quickly goods are moving through the supply chain.
D) It is a measure of the number of perfect orders.

Question 13

Which of the following is a disadvantage of vendor-managed inventory (VMI)

A) It often results in higher customer inventories than necessary.
B) It does not allow vendors to view inventory needs from the customer's perspective.
C) It prohibits the use of customer information, which leads to poor control of inventory and capacity.
D) It prevents vendors from making production decisions using downstream customer demand data.

Question 14

__________specialize in handling all aspects of customers giving back a manufactured good or delivered service and requesting their money back, repairing the manufactured good and giving it to the customer, and/or invoking the service guarantee.

A) Certified suppliers
B) Process designers
C) Demand forecasters
D) Return facilitators

Question 15

__________refers to managing the flow of finished goods, materials, or components that may be unusable or discarded through the supply chain from customers toward either suppliers, distributors, or manufacturers for the purpose of reuse, resale, or disposal.

A) Reverse logistics
B) Response management
C) Process design
D) Scheduling

Question 16

The Pharmaceutical Manufacturers Association defines a _____ as one that, after extensive investigation, is found to provide material of such quality that routine testing on each lot received is unnecessary.

A) certified supplier
B) contract manufacturer
C) licensed franchisor
D) return facilitator

Question 17

Speedex, an automobile company, has an annual sales volume of $3 million, cost of goods sold equal to $2 million, total average on-hand inventory of $600,000, and 150 operating days in a year. What is the daily revenue earned by the company

A) $10,000
B) $20,000
C) $30,000
D) $40,000

Question 18

Which of the following is true of purchasing

A) It can have a significant impact on total supply chain costs.
B) It is critical to satisfy employees' needs and expectations.
C) The delivery of goods and services is the responsibility of the purchasing function of a supply chain.
D) The principal goal of purchasing is to source products from a single supplier to avoid capacity risks.

Question 19

In the context of measuring supply chain performance, the goal of sustainability measures is to:

A) reduce the order cycle time for all customers.
B) have a byproduct-free production process.
C) have a carbon-neutral supply chain.
D) minimize the time taken to fill a customer's order.

Question 20

Technology upgrades and backup systems and sites can help mitigate security risks.

Question 21

ProShopper, a sportswear store, held an average sportswear inventory of $10 million last year and reported an inventory turnover of 5 times per year. What was its cost of goods sold

A) $10 million
B) $20 million
C) $40 million
D) $50 million

Question 22

Which of the following is true of order amplification

A) Order amplification in the supply chain leads to the bullwhip effect.
B) Large order sizes can help manage order amplification.
C) Order amplification decreases as one moves back up the supply chain away from the retail customer.
D) Increasing price fluctuations can help manage order amplification.

Question 23

_____ is the supply chain function responsible for acquiring raw materials, component parts, tools, services, and other items required from external suppliers.

A) Procurement
B) Scheduling
C) Integration
D) Job design

Question 24

In the context of the metrics used to identify improvements to the operation of supply chains, financial measures:

A) include perfect order fulfillment and perfect delivery fulfillment.
B) show how supply chain performance affects the bottom line.
C) calculate order fulfillment lead time in supply chains.
D) show how quickly goods move through supply chains.

Question 25

Josh Smith, the materials manager at a retail store, has determined that a particular product experienced 5 turns last year, with an annual sales volume of $15 million. What was the average inventory value for this product last year

A) $1 million
B) $2.5 million
C) $3 million
D) $4.5 million