Deck 3: Strategic and Financial Logistics

Question 1

A(n)___________ strategy refers to management of logistical activities with a goal of achieving coordination and collaboration through the channel.
a.market
b.process
c.differentiation
d.information

Answer 1

information

Question 2

The ___________ reflects the assets,liabilities,and owners' equity at a given point in time.
a.Balanced Scorecard (BSC)
b.balance sheet
c.income statement
d.Strategic Profit Model (SPM)

Answer 2

balance sheet

Question 3

Which of the following is not a level at which strategy can be formulated?
a.corporate
b.business unit
c.functional
d.individual location

Answer 3

individual location

Question 4

Which of the following does not appear on the balance sheet?
a.assets
b.owners' equity
c.liabilities
d.net income

Question 5

Which generic strategy concentrates an organization's effort on a narrowly defined market to achieve either a cost leadership or differentiation strategy?
a.hybrid
b.market orientation
c.tailored
d.focus

Question 6

___________ strategy decisions involve issues such as the number and location of warehouses and the selection of appropriate transportation modes.
a.Marketing
b.Production
c.Finance
d.Logistics

Question 7

A ___________ strategy entails an organization developing a product and/or service that offers unique attributes that are valued by customers and that the customer perceives to be distinct from competitor offerings.
a.focus
b.differentiation
c.value enhancement
d.market orientation

Question 8

When developing logistics strategy,a(n)___________ strategy refers to the management of logistics activities with a focus on costs.
a.market
b.process
c.differentiation
d.information

Question 9

In general,the ___________ measures the profitability of the products and/or services provided by a company.
a.balance sheet
b.Strategic Profit Model (SPM)
c.Balanced Scorecard (BSC)
d.income statement

Question 10

Strategy at a ___________ level is primarily focused on the products and services provided to customers and on finding ways to develop and maintain a sustainable competitive advantage with these customers.
a.functional
b.business unit
c.divisional
d.corporate

Question 11

Depending on industry and product type,reverse logistics costs as a percent of revenue can range between ___________ and ___________ percent.
a.5; 10
b.4; 8
c.3; 6
d.2; 4

Question 12

A(n)___________ entails the functional units of an organization providing input into the other levels of strategy formulation.
a.supply chain
b.differentiation strategy
c.hierarchy of strategy
d.enterprise resource system

Question 13

Which of the following does not affect cash flows within an organization?
a.revenue growth
b.asset utilization
c.inventory
d.accounts receivable

Question 14

The balance sheet reflects the assets,liabilities,and ___________ at a given point in time.
a.costs of goods sold
b.net income
c.owners' equity
d.asset turnover

Question 15

A(n)___________ strategy allows retail customers to order products anywhere,any time,and on any device,while also allowing them to take delivery when and where they want.
a.value co-creation
b.omnichannel
c.hybrid logistics
d.information-centric

Question 16

The ___________ shows revenues,expenses,and profit for a period of time.
a.balance sheet
b.current ratio
c.income statement
d.statement of cash flows

Question 17

Which of the following represents the preferred hierarchy of strategy (i.e.,from the first strategy to be developed to the last to be developed)?

A)corporate $\rightarrow$ business unit $\rightarrow$ functional
B)functional $\rightarrow$ business unit $\rightarrow$ corporate
C)corporate $\rightarrow$ business unit $\rightarrow$ divisional
D)business unit $\rightarrow$ divisional $\rightarrow$ functional

Question 18

Which of the following is not a potential type of logistics strategy decision?
a.investments in technology that support logistics activities
b.selection of appropriate transportation modes
c.deployment of inventory
d.product availability

Question 19

Which of the following is not one of the generic strategies that can be pursued by an organization,as identified by strategist Michael Porter?
a.value enhancement
b.differentiation
c.cost leadership
d.focus

Question 20

___________ strategy is focused on determining the goals for the company,the types of businesses in which the company should compete,and the way the company will be managed.
a.Functional level
b.Business unit level
c.Divisional level
d.Corporate level

Question 21

Suppose that a logistics manager is able to eliminate some unnecessary inventory,which reduces the value of current assets as well as total asset value.What is the corresponding impact on inventory turnover and return on assets (ROA)?
a.Both inventory turnover and ROA increase.
b.Inventory turnover increases and ROA decreases.
c.Inventory turnover decreases and ROA increases.
d.Both inventory turnover and ROA decrease.

Question 22

___________ looks at how long an organization's cash is tied up in receivables,payables,and inventory.
a.Cash-to-cash cycle
b.Cash flow
c.Gross margin return on investment (GMROI)
d.Current ratio

Question 23

What is the formula for net profit margin?
a.Gross Profit minus Interest Expenses
b.Sales divided by Costs of Goods Sold
c.Total Sales divided by Total Assets
d.Net Profit divided by Sales

Question 24

The Balanced Scorecard (BSC)approach is based on the belief that management should evaluate their business from ___________ distinct perspectives.
a.two
b.three
c.four
d.five

Question 25

Strategy at a business unit level is primarily focused on the types of businesses in which the company should compete and the way the company should be managed.

Question 26

Logistics measurement systems have been traditionally designed to include information on how many types of performance?
a.two
b.three
c.four
d.five

Question 27

The ___________ Act has implications for logistics managers in terms of internal controls,off balance sheet obligations,and timely reporting of material events.
a.Glass-Steagall
b.Financial Managers
c.Sarbanes-Oxley
d.Regulatory Accountability

Question 28

Strategy can be formulated at a corporate level,a business unit level,and a functional level.

Question 29

Developing financial fluency is a critical skill for contemporary logistics managers.

Question 30

Depending on the industry and product type,reverse logistics costs as a percentage of revenues can range between 2 and 4 percent.

Question 31

Logistics performance is important for achieving competitive advantage for many firms.

Question 32

What provides the framework for conducting return on assets (ROA)analysis by incorporating revenues and expenses to generate net profit margin,as well as inclusion of assets to measure asset turnover?
a.Balanced Scorecard (BSC)
b.Strategic Profit Model (SPM)
c.Balance Sheet
d.Supply Chain Operations Reference Model

Question 33

The ___________ is based on the belief that management should evaluate their business from four different perspectives.
a.Balanced Scorecard (BSC)
b.Strategic Profit Model (SPM)
c.Boston Consulting Group Matrix
d.Gross Margin Return on Inventory

Question 34

Performance measurement in ___________ is used to identify design and operations options that provide benefits in terms of increased speed or reduced costs.
a.materials handling
b.warehousing
c.packaging
d.order management

Question 35

Which of the following is a common measure of organizational financial success?
a.Net profit margin
b.Income statement
c.Current ratio
d.Return on Investment (ROI)

Question 36

What is the formula for asset turnover?
a.total sales divided by total assets
b.net profit divided by total assets
c.return on assets divided by total assets
d.return on investment divided by return on net worth

Question 37

With respect to net profit margin,the most relevant categories for logistics managers to consider are:
a.sales,costs of goods sold,and asset turnover.
b.accounts receivable,costs of goods sold,and total expenses.
c.sales,costs of goods sold,and total expenses.
d.inventory,accounts receivable,and total expenses.

Question 38

The current ratio is calculated by dividing ___________ by ___________.
a.total current assets; total current liabilities
b.total current liabilities; total current assets
c.total assets; total liabilities
d.total liabilities; total assets

Question 39

With respect to asset turnover,___________ is typically the most relevant logistics asset.
a.warehousing
b.inventory
c.transportation equipment
d.materials handling equipment

Question 40

Return on assets (ROA)equals:
a.current assets divided by total assets.
b.return on investment divided by return on net worth.
c.net profit margin times asset turnover.
d.total assets divided by costs of goods sold.

Question 41

The current ratio is calculated by dividing total current liabilities by total current assets.

Question 42

An understanding of financial terminology can help logisticians to manage logistical activities to improve their company's financial performance.

Question 43

The income statement details how an organization generates cash and where cash is used during a defined period of time.

Question 44

In terms of the statement of cash flows,the connections between logistics activities and cash flows occur primarily in the operating and financing areas.

Question 45

The hierarchy of strategy entails the functional units of an organization providing input into the other levels of strategy formulation.

Question 46

The income statement is the same thing as the balance sheet.

Question 47

A process strategy refers to management of logistics activities across business units with a focus on reducing complexity for customers.

Question 48

Research indicates a positive benefit to aligning functional strategies,such as marketing or logistics,with the overall corporate strategy.

Question 49

Functional level strategies exist in marketing and production,but not in logistics.

Question 50

Owners' equity is the difference between what a company owns and what it owes at any particular point in time.

Question 51

An omnichannel strategy allows retail customers to order products anywhere,any time,and on any device,while also allowing them to take delivery when and where they want.

Question 52

A common measure of organizational financial success is return on investment (ROI).

Question 53

Marketing goals in areas such as product availability,desired customer service levels,and packaging design have limited influence on logistics decisions.

Question 54

Three primary areas where the Sarbanes-Oxley Act (SOX)has implications for logistics managers are internal controls,off balance sheet obligations,and timely reporting of material events.

Question 55

In general,the income statement measures the profitability of the products and/or service provided by a company.

Question 56

Strategist Michael Porter identified three generic strategies that can be pursued by an organization-namely,cost leadership,differentiation,and value enhancement.

Question 57

Superior logistics service can have a positive influence on an organization's financial performance.

Question 58

Long-term assets have a useful life of more than two years.

Question 59

A differentiation strategy entails an organization developing a product and/or service that offers unique attributes that are valued by customers and that customers perceive to be distinct from competitor offerings.

Question 60

The balance sheet reflects the assets,liabilities,and costs of goods sold at a given point in time.

Question 61

The primary influence of logistics activities on sales would be through the improvement of customer service.

Question 62

With respect to asset turnover,inventory is typically the most relevant logistics asset.

Question 63

The cash-to-cash cycle looks at how long an organization's cash is tied up in receivables,payables,and inventory.

Question 64

The Balanced Scorecard (BSC)provides the framework for conducting return on assets (ROA)analysis by incorporating revenues and expenses to generate net profit margin,as well as inclusion of assets to measure asset turnover.

Question 65

The Balanced Scorecard (BSC)is based on the belief that management should evaluate their business from five different perspectives.

Question 66

Asset turnover is calculated by dividing return on assets by total assets.

Question 67

According to the Balanced Scorecard (BSC)approach,the financial perspective is considered the best indicator of whether or not logistics strategy is being properly implemented and executed.

Question 68

Return on assets (ROA)equals net profit margin times asset turnover.

Question 69

A reduction in inventory would increase inventory turnover,which means an increase in that organization's return on assets (ROA).

Question 70

A decision to invest in an electronic data interchange system that would increase invoice accuracy should result in a lower amount of accounts receivable.

Question 71

The measures associated with the Balanced Scorecard (BSC)can be at a strategic or tactical level.

Question 72

With respect to net profit margin,the most relevant categories for logistics managers to consider are sales,costs of goods sold,and asset turnover.

Question 73

Operationally,net profit margin is net profit divided by cost of goods sold.

Question 74

Best in Class companies tend to use transportation scorecards less frequently than other companies.

Question 75

When applying performance measures to logistics activities,determination of the key measures should be tailored to the individual organization and level of decision making.