Retail Management Midterm Exam - 3

What does WIP inventory consist of?

• Partially finished products awaiting further processing

• Finished products ready for distribution

• Unused inventory stored in warehouses

• Raw materials for production

What does the term 'Lead Time' refer to in inventory management?

• Time spent on inventory counting

• Time needed to manufacture a product

• Time taken to sell a product

• Time interval between ordering and receiving the order

What is the purpose of ABC Analysis in inventory management?

• To determine lead time for items

• To calculate average daily usage

• To track inventory movement

• To classify items based on values

What is the main objective of Inventory Management?

• Maximize total inventory cost

• Minimize customer service levels

• Minimize, if not eliminate wastage

• Increase holding costs

What does the EOQ Model help determine in inventory management?

• Average cycle inventory

• Ordering cost

• Reorder point

• Safety stock level

What is the purpose of V.E.D Analysis in inventory management?

• To calculate stock factor per product

• To classify items based on critical values and shortage cost

• To evaluate supply chain reliability

• To determine average daily usage

What does the term 'Stockouts' refer to in inventory management?

• Low reorder point levels

• High stock turnover rate

• Excess inventory levels

• Inability to satisfy demand for an item

What is the formula to calculate Stock Factor Approach per Product?

• SFp = Q + TSLE

• SFp = Q - TSLE

• SFp = Q /TSLE

• SFp = Q x TSLE

What is the main purpose of Setting Up Cost in inventory management?

• To calculate reorder point

• To evaluate costs associated with ordering inventory

• To track inventory movement

• To determine lead time

What is the significance of Finished Goods in inventory management?

• Extra stocks added to forecast stock

• Partially finished products awaiting further processing

• Completed products ready for distribution or sale

• Expenses associated with carrying inventory