What is the primary purpose of warehousing in the supply chain?
a) To produce goods
b) To store goods and manage inventory efficiently
c) To market products
d) To design new products Answer: b) To store goods and manage inventory efficiently
Which inventory management technique involves tracking inventory levels in real-time to avoid stockouts?
a) Just-in-Time (JIT)
b) Economic Order Quantity (EOQ)
c) Safety Stock
d) Perpetual Inventory System Answer: d) Perpetual Inventory System
What is “Cross-Docking” in warehousing?
a) The process of storing goods for long periods
b) Directly transferring goods from incoming to outgoing transportation with minimal storage
c) Combining multiple shipments into one larger shipment
d) Returning goods from customers to the supplier Answer: b) Directly transferring goods from incoming to outgoing transportation with minimal storage
What does “Safety Stock” refer to in inventory management?
a) Inventory used for future production
b) Extra inventory held to prevent stockouts due to demand variability or supply chain disruptions
c) Inventory that is obsolete
d) Inventory held for promotional purposes Answer: b) Extra inventory held to prevent stockouts due to demand variability or supply chain disruptions
Which of the following is a common method for managing warehouse space efficiently?
a) Random Stacking
b) Slotting
c) Cross-Docking
d) Reorder Point Answer: b) Slotting
What is the primary benefit of using an Automated Storage and Retrieval System (AS/RS)?
a) Increasing the variety of products offered
b) Enhancing the speed and accuracy of inventory handling
c) Reducing marketing costs
d) Expanding the production capacity Answer: b) Enhancing the speed and accuracy of inventory handling
What does “Economic Order Quantity (EOQ)” aim to achieve?
a) Maximizing inventory holding costs
b) Minimizing the total cost of ordering and holding inventory
c) Increasing the reorder point
d) Expanding warehouse space Answer: b) Minimizing the total cost of ordering and holding inventory
Which inventory management method involves ordering products only when needed based on actual sales data?
a) Just-in-Time (JIT)
b) ABC Analysis
c) Safety Stock
d) Fixed Order Quantity Answer: a) Just-in-Time (JIT)
What is “Cycle Counting” in inventory management?
a) Counting inventory once a year
b) Counting a portion of the inventory on a rotating schedule to ensure accuracy
c) Counting inventory during the production process
d) Counting only the inventory that is about to expire Answer: b) Counting a portion of the inventory on a rotating schedule to ensure accuracy
Which of the following is NOT typically a feature of modern warehouse management systems (WMS)?
a) Real-time inventory tracking
b) Automated order picking
c) Product design and development
d) Barcode scanning Answer: c) Product design and development
What is the purpose of “Inventory Turnover Ratio”?
a) To measure the number of times inventory is sold and replaced over a period
b) To determine the total value of inventory held
c) To calculate the cost of goods sold
d) To track the number of suppliers Answer: a) To measure the number of times inventory is sold and replaced over a period
What is the “Reorder Point” in inventory management?
a) The point at which inventory is ordered to replenish stock before it runs out
b) The maximum level of inventory to be held
c) The point at which products are sold at a discount
d) The point at which inventory becomes obsolete Answer: a) The point at which inventory is ordered to replenish stock before it runs out
Which inventory management technique involves categorizing inventory items based on their importance and value?
a) Just-in-Time (JIT)
b) ABC Analysis
c) Safety Stock
d) Economic Order Quantity (EOQ) Answer: b) ABC Analysis
What is the main advantage of implementing a “Vendor Managed Inventory (VMI)” system?
a) Reducing the number of suppliers
b) Allowing suppliers to manage inventory levels based on real-time data
c) Increasing warehouse space
d) Expanding product lines Answer: b) Allowing suppliers to manage inventory levels based on real-time data
Which of the following best describes “Warehouse Slotting”?
a) Allocating storage locations for products based on their picking frequency and other factors
b) Counting inventory at regular intervals
c) Managing vendor relationships
d) Designing warehouse layouts Answer: a) Allocating storage locations for products based on their picking frequency and other factors
What does “Just-in-Case (JIC)” inventory management aim to do?
a) Reduce safety stock
b) Increase flexibility by holding extra inventory to mitigate uncertainties
c) Minimize ordering costs
d) Maximize production speed Answer: b) Increase flexibility by holding extra inventory to mitigate uncertainties
What is “Demand Forecasting” used for in inventory management?
a) Estimating future customer demand to plan inventory levels effectively
b) Managing warehouse space
c) Designing marketing strategies
d) Evaluating supplier performance Answer: a) Estimating future customer demand to plan inventory levels effectively
What is the role of “Inventory Visibility” in supply chain management?
a) Increasing the number of suppliers
b) Ensuring accurate and real-time tracking of inventory levels across the supply chain
c) Enhancing product design
d) Expanding production facilities Answer: b) Ensuring accurate and real-time tracking of inventory levels across the supply chain
Which term refers to the cost of holding unsold inventory in a warehouse?
a) Ordering cost
b) Holding cost
c) Setup cost
d) Carrying cost Answer: b) Holding cost
What is “Slotting Optimization” in warehouse management?
a) Increasing the number of products stored
b) Improving the efficiency of picking and storing by strategically placing items
c) Expanding warehouse space
d) Reducing inventory levels Answer: b) Improving the efficiency of picking and storing by strategically placing items