...Operations Management, 10e (Heizer/Render) Chapter 12 Inventory Management 1) According to the global company profile, Amazon.com's advantage in inventory management comes from its almost fanatical use of economic order quantity and safety stock calculations. Answer: FALSE Diff: 1 Topic: Global company profile Objective: no LO 2) A major challenge in inventory management is to maintain a balance between inventory investment and customer service. Answer: TRUE Diff: 1 Topic: The importance of inventory Objective: no LO 3) Which item to order and with which supplier the order should be placed are the two fundamental issues in inventory management. Answer: FALSE Diff: 2 Topic: The importance of inventory Objective: no LO 4) One function of inventory is to take advantage of quantity discounts. Answer: TRUE Diff: 1 Topic: Functions of inventory Objective: no LO 5) Work-in-process inventory is devoted to maintenance, repair, and operations. Answer: FALSE Diff: 1 Topic: Functions of inventory Objective: no LO 6) ABC analysis classifies inventoried items into three groups, usually based on annual units or quantities used. Answer: FALSE Diff: 1 Topic: Managing inventory Objective: LO12-1 7) In ABC analysis, "A" Items are the most tightly controlled. Answer: TRUE Diff: 2 Topic: Managing inventory Objective: LO12-1 1 Copyright © 2011 Pearson Education, Inc 8) ABC analysis is based on the presumption that carefully controlling all items is necessary to produce...
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...Supply Chain Management Student: ___________________________________________________________________________ 1. The development of progressive purchasing approaches and strategies can only help a company maintain its competitive position. True False 2. Global sourcing is no longer a requirement and is a luxury for most firms. True False 3. Sophisticated customers, both industrial and consumer, no longer talk about price increases; they demand price reductions. True False 4. An abundance of competitors and choices have conditioned customers to want higher quality, faster delivery, and products and services tailored to their individual needs albeit at a higher total cost. True False 5. The availability of low-cost domestic supplier alternatives has led to the shift away from outsourcing and offshoring. True False 6. Competition today is no longer between firms; it is between the supply chains of those firms. True False 7. In the manufacturing sector, the percentage of purchases to sales averages 55%. True False 8. The traditional approach to purchasing and supply management is to build relations with suppliers to jointly pull costs out of the product or service and expect suppliers to contribute innovate ideas that continually add value to a firm's products and services. True False 9. Virtually all of the features that make their way into final products originate with suppliers. True False 10. Purchasing...
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...16 Product waste is an example of waste in the sense that no value is added- true In a JIT system, product inspection adds value by identifying defective items-false A push system means providing the station with exactly what is needed when it is needed-false Waste is anything that does not add value from the consumers prospective- True Increasing inventory exposes variability in production processes-false The 5’s do not include-safety Manufacturing cycle time is best described as-time from raw material to finished product. A common JIT layout tactic is to minimize distance-true One goal of JIT partnerships is the removal of in plant inventory by delivery in small lots directly to the using as needed-true JIT supplies have concerns that the JIT firms demands for a small lot size are simply a way of transforming holding costs from HIT firm to Supplies-true Which of the following is true regarding the steps to reducing setup times? All the above Which if the following statements is true about the Kanban system?-The customer workstation signals to supplier workstations when production is needed. Employee empowerment is not needed at the Toyota plant-true Kaizen- continuous improvement. Jidoka-stop production when defect Which of the following is not one of the principles at Toyota? Improvements with scientific method JIT has internal focus while lean production begins with external focus on-Customers Not an attributes to lean operations- Increase space required...
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...and decisions. TRUE 2. Managerial accounting reports are prepared according to generally accepted accounting principles. FALSE 3. Managerial accounting information includes both historical and estimated data. TRUE 4. Since there are few rules to restrict how an organization chooses to arrange its own internal data for decision making, managerial accounting provides ample opportunity for creativity and change. TRUE 5. A diagram of the operating structure of an organization is called an organization chart. TRUE 6. In most business organizations, the chief accountant is called the treasurer. FALSE 7. In most business organizations, the chief accountant is called the controller. TRUE 8. A staff department or unit is one that provides services, assistance, and advice to the departments with line or other staff responsibilities. TRUE 9. The vice presidents of production and sales and the controller hold line positions in most large organizations. FALSE 10. A staff department has no direct authority over a line department. TRUE 11. The controller's staff consists of management accountants responsible for systems and procedures, general accounting, budgets, taxes, and cost accounting. TRUE 12. Managerial accounting reports must be useful to the user of the information. TRUE 13. Planning is the process of monitoring operating results and comparing actual results with the expected results. FALSE 14. Planning is...
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...Chapter 15 The design of the supply chain and establishing partnerships with vendors and distributors are examples of operating issues in a supply chain. | True | | False | These are tactical responsibilities. Returned goods are part of reverse logistics. | True | | False | Reverse logistics involves managing the flow of goods back up the supply chain. Using third-party fulfillment means losing control of fulfillment. | True | | False | Outsource this key function means a loss of control. Small changes in consumer demand can result in large variations in orders placed because of the … | Safety stock requirement | | FCFS scheduling | | Lead time effect | | Bullwhip effect | | Supply chain | Variations are amplified as they move backwards in the supply chain. A factor that makes it desirable for business organizations to actively manage their supply chains is: | more potential vendors | | increasing globalization | | the internet | | downsizing | | RFID's | Globalization is making supply chain management more important. Which of the following is a barrier to integration of separate organizations in the supply chain? (I) conflicting objectives of the companies in the chain. (II) different level of capacity of the companies in the chain. (III) reluctance of the organizations in the chain to allow other organizations access to their data. | I, II and III | | I only | | II and III | → | I and...
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...Chapter 01 Operations and Supply Chain Management Learning Objectives for Chapter 1 1. Understand why it is important to study operations and supply chain management. 2. Define efficient and effective operations. 3. Categorize operations and supply chain processes. 4. Contrast differences between services and goods producing processes. 5. Identify operations and supply chain management career opportunities. 6. Describe how the field has developed over time. True / False Questions 1. Efficiency means doing the right things to create the most value for the company. True False 2. Effectiveness means doing the right things to create the most value for the company. True False 3. A doctor completes a surgical procedure on a patient without error. The patient dies anyway. In operations management terms, we could refer to this doctor as being efficient but not effective. True False 4. A worker can be efficient without being effective. True False 5. A process can be effective without being efficient. True False 6. Operations and supply management is defined as the design, operation, and improvement of the systems that create and deliver the firm's primary products and services. True False 7. The term "value" refers to the relationship between quality and the price paid by the consumer. True False 8. Attempting to balance the desire to efficiently use resources...
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...Chapter 3 Supply Chain Drivers and Metrics True/False 1. The major drivers of supply chain performance are facilities, inventory, transportation, and information. Answer: True Difficulty: Moderate 2. The major drivers of supply chain performance are customers, facilities, inventory, transportation, and information. Answer: False Difficulty: Moderate 3. The two major types of facilities are production sites and storage sites. Answer: True Difficulty: Moderate 4. The two major types of facilities are distribution sites and storage sites. Answer: False Difficulty: Moderate 5. Inventory is an important supply chain driver because changing inventory policies can dramatically alter the supply chain’s efficiency and responsiveness. Answer: True Difficulty: Moderate 6. Information is potentially the biggest driver of performance in the supply chain as it directly affects each of the other drivers. Answer: True Difficulty: Easy 7. Information is potentially the biggest driver of performance in the supply chain even though it has little impact on each of the other drivers. Answer: False Difficulty: Easy 8. A facility with little excess capacity will likely be more efficient per unit of product it produces than one with a lot of unused capacity. Answer: True Difficulty: Easy 9. A facility with little...
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...Chapter 14 Working Capital and Current Assets Management LearningGoals 1. 2. 3. 4. 5. 6. Understand short-term financial management, net working capital, and the related tradeoff between profitability and risk. Describe the cash conversion cycle, its funding requirements, and the key strategies for managing it. Discuss inventory management: differing views, common techniques, and international concerns. Explain the credit selection process and the quantitative procedure for evaluating changes in credit standards. Review the procedures for quantitatively considering cash discount changes, other aspects of credit terms, and credit monitoring. Understand the management of receipts and disbursements, including floats, speeding collections, slowing payments, cash concentration, zero-balance accounts, and investing in marketable securities. True/False 1. A firm that is unable to pay its bills as they come due is technically insolvent. Answer: TRUE Level of Difficulty: 1 Learning Goal: 1 Topic: Basics of Short-Term Financial Management 2. The short-term financial management is concerned with management of the firm’s current assets and current liabilities. Answer: TRUE Level of Difficulty: 1 Learning Goal: 1 Topic: Basics of Short-Term Financial Management 45 Gitman • Principles of Finance, Eleventh Edition 3. In the short-term financial management, the goal is to manage each of the firm’s current assets and current liabilities in order to achieve a balance between...
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...Chapter 3 Supply Chain Drivers and Metrics True/False 1. The major drivers of supply chain performance are facilities, inventory, transportation, and information. Answer: True Difficulty: Moderate 2. The major drivers of supply chain performance are customers, facilities, inventory, transportation, and information. Answer: False Difficulty: Moderate 3. The two major types of facilities are production sites and storage sites. Answer: True Difficulty: Moderate 4. The two major types of facilities are distribution sites and storage sites. Answer: False Difficulty: Moderate 5. Inventory is an important supply chain driver because changing inventory policies can dramatically alter the supply chain’s efficiency and responsiveness. Answer: True Difficulty: Moderate 6. Information is potentially the biggest driver of performance in the supply chain as it directly affects each of the other drivers. Answer: True Difficulty: Easy 7. Information is potentially the biggest driver of performance in the supply chain even though it has little impact on each of the other drivers. Answer: False Difficulty: Easy 8. A facility with little excess capacity will likely be more efficient per unit of product it produces than one with a lot of unused capacity. Answer: True Difficulty: Easy 9. A facility with little...
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...Exam Name___________________________________ TRUE/FALSE. Write 'T' if the statement is true and 'F' if the statement is false. 1) Companies can use configuration tables provided by the enterprise software to tailor a particular aspect of the system to the way it does business. Answer: True False 2) Enterprise systems are typically built around one or two major business workflows. Answer: True False 3) Enterprise systems are designed primarily to allow communication between an organization and outside partners and suppliers. Answer: True False 4) The upstream portion of the supply chain consists of the organizations and processes for distributing and delivering products to the final customers. Answer: True False 5) Supply chain inefficiencies can waste as much as 25 percent of a company’s operating costs. Answer: True False 6) Safety stock acts as an inexpensive buffer for the lack of flexibility in the supply chain. Answer: True False 7) The bullwhip effect is the distortion of information about the demand for a product as it passes from one entity to the next across the supply chain. Answer: True False 8) Supply chain execution systems enable the firm to generate demand forecasts for a product and to develop sourcing and manufacturing plans for that product. Answer: True False 9) To minimize the expense of implementing an enterprise...
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...FINANCIAL STATEMENTS (Difficulty: E = Easy, M = Medium, and T = Tough) True-False Easy: Ratio analysis Answer: a Diff: E [i]. Ratio analysis involves a comparison of the relationships between financial statement accounts so as to analyze the financial position and strength of a firm. a. True b. False Liquidity ratios Answer: b Diff: E [ii]. The current ratio and inventory turnover ratio measure the liquidity of a firm. The current ratio measures the relationship of a firm's current assets to its current liabilities and the inventory turnover ratio measures how rapidly a firm turns its inventory back into a "quick" asset or cash. a. True b. False Current ratio Answer: b Diff: E [iii]. If a firm has high current and quick ratios, this is always a good indication that a firm is managing its liquidity position well. a. True b. False Asset management ratios Answer: a Diff: E [iv]. The inventory turnover ratio and days sales outstanding (DSO) are two ratios that can be used to assess how effectively the firm is managing its assets in consideration of current and projected operating levels. a. True b. False Inventory turnover ratio Answer: b Diff: E [v]. A decline in the inventory turnover ratio suggests that the firm's liquidity position is improving. a. True b. False Debt management ratios Answer: a Diff: E [vi]. The degree to which the managers of a firm...
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...planning and control. Answer: TRUE Diff: 1 LO: 18-1 AACSB: Concept AICPA Functional: Reporting 2) Financial accounting prepares reports for internal purposes, whereas managerial accounting provides information to external stakeholders. Answer: FALSE Diff: 1 LO: 18-1 AACSB: Concept AICPA Functional: Reporting 3) The IMA standards of ethical practice require managerial accountants to maintain their professional competence. Answer: TRUE Diff: 1 LO: 18-1 AACSB: Ethical Understanding AICPA Functional: Reporting 4) The accountant for Myra Lido deliberately deferred cash payments for business expenses in order to record a higher operating cash flow for the company. As long as the amount was not material, this would not be considered unethical behavior. Answer: FALSE Diff: 1 LO: 18-1 AACSB: Ethical Understanding AICPA Functional: Reporting 5) Financial statements prepared for investors and creditors often include forward-looking information because they make decisions based on a company's future prospects. Answer: FALSE Diff: 1 LO: 18-1 AACSB: Concept AICPA Functional: Reporting 6) Management accounting reporting by a public firm is required to follow the rules of GAAP and guidelines of the Securities Exchange Commission. Answer: FALSE Diff: 1 LO: 18-1 AACSB: Concept AICPA Functional: Reporting 7) A budget is a managerial accounting tool used in the planning process. Answer: TRUE Diff: 1 LO: 18-1 AACSB: Concept ...
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... 1. According to the text, Zara's strategy of speed and flexibility has enabled the company to eliminate inventory. True False According to the text, Zara's strategy focuses on continual renewal of its clothing lines. True False According to the text, outsourcing is hiring others to do noncore activities. True False According to the text, any activity in the value chain can be outsourced except for strategy and management. True False According to the text, the process of coordinating and integrating the flow of materials, information, finances, and services within and among companies in the value chain is called operations management. True False Supply chains are an integral part of global quality and cost management initiatives, since a typical company's supply chain costs can represent over 80 percent of assets. True False Because inventory is carried at each stage in the supply chain, and because inventory ties up money, it has been argued that the ultimate goal of effective supply chain management systems is to reduce inventory. True False According to the text, shorter and less predictable product life cycles have placed reduced emphasis on supply chains and their performance. True False Effective supply chain management can enhance a company's ability to manage regulatory, social, and other environmental pressures, both within a nation and globally. True False 2. 3. 4. 5. 6. 7. 8. 9. 10. An important consideration in design is the extent to which...
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...PAGE # 1 Essentials of Corporate Finance, 7/e Solved McQs PAGE # 2 Introduction to Financial Management Q#1 Business finance includes determining which long-term assets a firm should purchase. A) True B) False Q#2 The board of directors has the power to act on behalf of the shareholders to hire and fire the operating managers of the firm. In a legal sense, the directors are "principals" and the shareholders are "agents." A) True B) False Q#3 In capital budgeting, the financial manager tries to identify investment opportunities that will increase the value of the firm. A) True B) False Q#4 Three advantages of the corporate form of organization are the ease of transfer of ownership, limited liability for the shareholders and an unlimited life for the business entity. A) True B) False Q#5 The intent of the Sarbanes-Oxley Act of 2002 is to protect the public from accounting fraud and financial malpractice. A) True B) False Q#6 Financial managers are responsible for determining: I. how suppliers will be paid. II. the appropriate level of debt for a firm. III. which projects a firm should undertake. IV. how to invest the firm's cash. A) I and II only II and III only B) C) I, II and III only D) II, III and IV only E) I, II, III and IV Q#7 Ann is interested in purchasing Ted's factory. Since Ann is a poor negotiator, she hires Mary to negotiate a purchase price. Identify the parties to this transaction. A) Mary is the principal and Ann is the agent. B) Ted is the principal...
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...companies and privately held companies with assets greater than $500 million. Answer Terms: Sarbanes-Oxley Act Diff: Easy Objective: LO 1-1 AACSB: Reflective thinking skills Topic: SOX 2) Which of the following is considered audit evidence? A) Oral statements Written Auditor made by management Communications Observation Y N N B) Oral statements made by management N C) Oral statements made by management Y Written Communications Y Auditor Observation Y Written Communications Y Auditor Observation Y D) Oral statements made by management N Answer Terms: Audit evidence Diff: Moderate Objective: LO 1-1 AACSB: Reflective thinking skills Written Communications N Auditor Observation Y 3) Evidence is paramount to audit and attestation engagements. List the four basic types of audit evidence. 4) The criteria by which an auditor evaluates the information under audit may vary with the information being audited. A) True B) False Terms: Criteria which an auditor evaluates information Diff: Easy Objective: LO 1-1 AACSB: Reflective thinking skills 5) The criteria used by an external auditor to evaluate published financial statements are known as generally accepted auditing standards. A) True B) False Answer Terms: Criteria used by external auditor to evaluate...
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