1) Ali's Stationery Shop has a yearly demand for 14,850 pencils. Ali runs his business 330 days a year and finds that delivery from his supplier takes around 3 working days on average. Calculate the pencil's re-order point. a) 15 units b) 135 units c) 4620 units d) 42 units 2) Which inventory classification stimulates demand? a) Safety stock b) Pipeline stock c) Psychic stock d) Speculative stock 3) Based on the information given, calculate the ordering cost. The ordering cost per order is RM 100. The number of order is 5 times per year. The annual demand is 10,000 units a) RM 100 b) RM 2,500 c) RM 5,000 d) RM 500 4) What is Stock-out cost? a) Stock-out cost is the lost income and expense associated with shortage of inventory b) Stock-out cost is the lost income and expense associated with a surplus of inventory c) Time interval between ordering and receiving the order d) Cost to store inventory 5) What is Safety stock? a) Sufficient inventory b) Extra inventory c) Stochastic d) Extra cost 6) What is the functions of inventory? a) To lengthen production lead time b) To meet anticipated customer demand c) To increase the efficiency of the production d) To minimize the cost at production level 7) Given average cost per stock out is RM 200 and additional orders filled is 20. What is the stock-out avoided? a) RM 4000 b) RM 10 c) RM 220 d) RM 180 8) What is dead inventory? a) Inventory that is unsellable during 1 year period b) Returned item by the customer c) Inventory that has the highest turnover rate in 1 year period d) Inventory that can reduce the the cost of carrying and storing 9) What is complementary products?  a) A product that can fill the same need or want as another product b) Completed product awaiting shipment c) Goods that interdependent to each other  d) Intangible products 10) Level of inventory that a business maintains has a big effect on the overall liquidity and profitability of the company. a) Supply Management b) Safety Management c) Inventory Management d) Business Management

Inventory management

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