Question 1

Given the following make-buy information, what would be the break-even point?

Accepted Answer

A)  9170 units 
B)  3650 units 
C)  1040 units 
D)  2750 units 
A)  9170 units 
B)  3650 units 
C)  1040 units 
D)  2750 units

Question 2

Generally, firms outsource noncore activities while focusing on core competencies.

Accepted Answer

A) True 
 B)False

Question 3

Under which conditions would you most likely utilize a centralized purchasing system? List two advantages that would be gained by utilizing a centralized purchasing system.
Under which conditions would you most likely utilize a decentralized purchasing system? List two advantages that would be gained by utilizing a decentralized purchasing system.

Accepted Answer

Under which conditions would you most li

Question 4

Total Cost of Ownership does NOT consider which of the following factors?

Accepted Answer

A)  Purchase order costs 
B)  Freight costs 
C)  Payment terms 
D)  Tooling costs 
A)  Purchase order costs 
B)  Freight costs 
C)  Payment terms 
D)  Tooling costs

Question 5

Use the following information to determine which supplier for steering wheels is more cost-effective using total cost analysis.Late delivery of the component results in 50% lost sales and 50% back orders of finished goods.
Table 1
   
Table 2
   
Here is the freight rates for
Truckload (TL ? 40,000 lbs): $0.90 per ton-mile
Truckload Less-than-truckload (LTL): $1.10 per ton-mile
Note: per ton-mile = 2,000 lbs.per mile; number of days per year = 365

Accepted Answer

@#IMG-DLM&
Total cost of ownership =225,600-5130+1

Question 6

The procedures for public procurement differ from the private sector.

Accepted Answer

A) True 
 B)False

Question 7

The purchase order is NOT a legally binding contract until it is accepted by the supplier.

Accepted Answer

A) True 
 B)False

Question 8

Decentralized purchasing is the practice where individual, local purchasing departments throughout a single corporation make their own, individual purchasing decisions to fulfill their individual local needs.

Accepted Answer

A) True 
 B)False

Question 9

When using the Total Cost of Ownership concept, explain how a supplier with a higher unit price and higher tooling cost can end up being more cost effective than another supplier with a lower unit price and tooling cost.

Accepted Answer

When calculating the Total Cost of Owner

Question 10

If the break-even point in a typical make-buy scenario is 19,000 units and 10,000 units are required by the firm, then the firm should choose to make the units.

Accepted Answer

A) True 
 B)False

Question 11

Petty cash is being phased out in favor of:

Accepted Answer

A)  Hard cash 
B)  A blank check 
C)  P-card 
D)  Score-carding 
A)  Hard cash 
B)  A blank check 
C)  P-card 
D)  Score-carding

Question 12

A follow-up is considered a reactive approach to speed up an overdue shipment.

Accepted Answer

A) True 
 B)False

Question 13

Firms can use total cost analysis to:

Accepted Answer

A)  See how efficiently management is using its total assets to generate profits 
B)  Select the most cost-effective supplier 
C)  Show how many times a firm's inventory is utilized and replaced over an accounting period 
D)  Brainstorm and isolate the causes of a problem 
A)  See how efficiently management is using its total assets to generate profits 
B)  Select the most cost-effective supplier 
C)  Show how many times a firm's inventory is utilized and replaced over an accounting period 
D)  Brainstorm and isolate the causes of a problem

Question 14

Given the following make-buy information, what would be the break-even point?

Accepted Answer

A)  1200 units 
B)  1708 units 
C)  800 units 
D)  460 units 
A)  1200 units 
B)  1708 units 
C)  800 units 
D)  460 units

Question 15

Foreign suppliers located farther away may be able to deliver goods faster than domestic suppliers due to more efficient transportation and logistical systems.

Accepted Answer

A) True 
 B)False

Question 16

Which of the following statements is FALSE?

Accepted Answer

A)  Centralized purchasing is where individual, local purchasing departments, such as at the plant level, make their own purchasing decisions. 
B)  Electronic procurement systems can aid a company in saving both time and money. 
C)  More than 50% of each sales dollar typically goes towards covering supply chain costs. 
D)  If a firm lacks the technology to make a required component they will need to consider buying/outsourcing. 
A)  Centralized purchasing is where individual, local purchasing departments, such as at the plant level, make their own purchasing decisions. 
B)  Electronic procurement systems can aid a company in saving both time and money. 
C)  More than 50% of each sales dollar typically goes towards covering supply chain costs. 
D)  If a firm lacks the technology to make a required component they will need to consider buying/outsourcing.

Question 17

Which type of requisition is used for materials and standard parts that are requested on a recurring basis?

Accepted Answer

A)  Open requisition 
B)  Blanket requisition 
C)  Traveling requisition 
D)  Recyclable requisition (Cyc-Rec) 
A)  Open requisition 
B)  Blanket requisition 
C)  Traveling requisition 
D)  Recyclable requisition (Cyc-Rec)

Question 18

The term Supply Management is used to describe responsibilities above and beyond those of traditional purchasing.What are three of these key activities and why are they considered important to Supply Management?

Accepted Answer

Other answers are possible.
a.Supply Man

Question 19

Which of the following illustrates Forward Vertical Integration?

Accepted Answer

A)  Microsoft starting a new division that designs and manufactures clothing 
B)  Ford automotive buying additional machines for production 
C)  Subway sandwich company buying a bakery to make the bread for their sandwiches. 
D)  Sony buying trucks to deliver their finished goods inventories to their customers' warehouses 
A)  Microsoft starting a new division that designs and manufactures clothing 
B)  Ford automotive buying additional machines for production 
C)  Subway sandwich company buying a bakery to make the bread for their sandwiches. 
D)  Sony buying trucks to deliver their finished goods inventories to their customers' warehouses

Question 20

Which of the following refers to the measurement of the impact of change in purchase spend on a firm's profit before taxes, assuming gross sales and other expenses remain unchanged?

Accepted Answer

A)  Break-Even Analysis 
B)  Profit-Leverage Effect 
C)  Direct Offset 
D)  Leveraging Purchase Volume 
A)  Break-Even Analysis 
B)  Profit-Leverage Effect 
C)  Direct Offset 
D)  Leveraging Purchase Volume

Given the following make-buy information, what would be the break-even point?

Generally, firms outsource noncore activities while focusing on core competencies.

Total Cost of Ownership does NOT consider which of the following factors?

The procedures for public procurement differ from the private sector.

The purchase order is NOT a legally binding contract until it is accepted by the supplier.

Decentralized purchasing is the practice where individual, local purchasing departments throughout a single corporation make their own, individual purchasing decisions to fulfill their individual local needs.

When using the Total Cost of Ownership concept, explain how a supplier with a higher unit price and higher tooling cost can end up being more cost effective than another supplier with a lower unit price and tooling cost.

If the break-even point in a typical make-buy scenario is 19,000 units and 10,000 units are required by the firm, then the firm should choose to make the units.

Petty cash is being phased out in favor of:

A follow-up is considered a reactive approach to speed up an overdue shipment.

Firms can use total cost analysis to:

Given the following make-buy information, what would be the break-even point?

Foreign suppliers located farther away may be able to deliver goods faster than domestic suppliers due to more efficient transportation and logistical systems.

Which of the following statements is FALSE?

Which type of requisition is used for materials and standard parts that are requested on a recurring basis?

The term Supply Management is used to describe responsibilities above and beyond those of traditional purchasing.What are three of these key activities and why are they considered important to Supply Management?

Which of the following illustrates Forward Vertical Integration?

Which of the following refers to the measurement of the impact of change in purchase spend on a firm's profit before taxes, assuming gross sales and other expenses remain unchanged?

Introduction to Supply Chain Management

Creating and Managing Supplier Relationships

Ethical and Sustainable Sourcing

Demand Forecasting

Resource Planning Systems

Inventory Management

Process Management: Lean and Six Sigma in the Supply Chain

Domestic U.S.and Global Logistics

Customer Relationship Management

Global Location Decisions

Service Response Logistics

Supply Chain Process Integration

Performance Measurement Along the Supply Chain

Filters

Exam 2: Purchasing Management

Given the following make-buy information, what would be the break-even point?

Generally, firms outsource noncore activities while focusing on core competencies.

Total Cost of Ownership does NOT consider which of the following factors?

The procedures for public procurement differ from the private sector.

The purchase order is NOT a legally binding contract until it is accepted by the supplier.

Decentralized purchasing is the practice where individual, local purchasing departments throughout a single corporation make their own, individual purchasing decisions to fulfill their individual local needs.

When using the Total Cost of Ownership concept, explain how a supplier with a higher unit price and higher tooling cost can end up being more cost effective than another supplier with a lower unit price and tooling cost.

If the break-even point in a typical make-buy scenario is 19,000 units and 10,000 units are required by the firm, then the firm should choose to make the units.

Petty cash is being phased out in favor of:

A follow-up is considered a reactive approach to speed up an overdue shipment.

Firms can use total cost analysis to:

Given the following make-buy information, what would be the break-even point?

Foreign suppliers located farther away may be able to deliver goods faster than domestic suppliers due to more efficient transportation and logistical systems.

Which of the following statements is FALSE?

Which type of requisition is used for materials and standard parts that are requested on a recurring basis?

The term Supply Management is used to describe responsibilities above and beyond those of traditional purchasing.What are three of these key activities and why are they considered important to Supply Management?

Which of the following illustrates Forward Vertical Integration?

Which of the following refers to the measurement of the impact of change in purchase spend on a firm's profit before taxes, assuming gross sales and other expenses remain unchanged?

Introduction to Supply Chain Management

Creating and Managing Supplier Relationships

Ethical and Sustainable Sourcing

Demand Forecasting

Resource Planning Systems

Inventory Management

Process Management: Lean and Six Sigma in the Supply Chain

Domestic U.S.and Global Logistics

Customer Relationship Management

Global Location Decisions

Service Response Logistics

Supply Chain Process Integration

Performance Measurement Along the Supply Chain

Filters