Exam 15: Managing Suppliers and Customers

Specialty Manufacturing requires 5400 gadgets per year for production. The firm decides to order 120 gadgets at a time. The costs of ordering are $50 per order and carrying costs per gadget are $2. Annual ordering costs are:

Customer response time may be defined as:

Time-based management considers time and profitability as a main means for measuring performance.

The pull system of production management is driven by the actual demands of the final customer.

The activity where there is an additional cost incurred by a buying firm as the result of a quality problem is known as:

An example of a shortage cost is:

Which of the following costs should be included in customer profitability analysis? i. Product costs ii. Distribution iii. Customer servicing iv. Finished goods inspection costs

GoGo Furniture needs to purchase glass panes to make glass top coffee tables. Last year GoGo Furniture had two suppliers, BolBol and TolTol. Based on last year's experience with these two suppliers, GoGo provides you with the following supplier related information: What is the total amount of order-level costs relating to BolBol?

Which of the following are examples of delivery costs? i. Receiving ii. Inwards inspection iii. Opportunity cost

Which of the following statements is false?

When determining the total costs of purchasing, an organisation will include the costs of materials, inventory ordering, selling and delivery.

A customer has placed an order with Cyborg Computers for a custom-made computer. However, as a result of a system error, the order was lost. It took the sales representative three days to locate the order again. Once the order was located, the sales representative sent the order to the production department. This error is likely to negatively affect which of the following?

The break-even time has which of the following characteristics? i. It cannot be established until after the product development cycle is completed. ii. It encourages incremental projects. iii. It discourages major projects that take a long time. iv. It measures cash flow not profit.

Specialty Manufacturing requires 5400 gadgets per year for production. The firm decides to order 120 gadgets at a time. The costs of ordering are $50 per order and carrying costs per gadget are $2. Annual carrying costs are:

Average cycle time is estimated by:

The analysis of the cost of products purchased and associated customer driven costs is known as:

A firm that uses a just-in-time purchasing philosophy probably:

GoGo Furniture needs to purchase glass panes to make glass top coffee tables. Last year GoGo Furniture has two suppliers, BolBol and TolTol. Based on last year's expernece with these two suppliers, GoGo provides you with the following supplier related information: The supplier performance index of BolBol and TolTol are, respectively:

A formal agreement between organisations with the intention to share resources is known as a:

The following dates apply to a specific order processed by Hamilton Ltd: What is the order receipt time?