quiz 7 & 8.docx - In ABC analysis"A" items are...

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In ABC analysis, "A" items are the most tightly controlled. True Your answer is correct. False Which of the following would NOT generally be a motive for a firm to hold inventories? A. to decouple various parts of the production process B. to hedge against inflation C. to provide a selection of goods for anticipated customer demand and to separate the firm from fluctuations in that demand Your answer is not correct.D. to minimize holding costs This is the correct answer.E. to take advantage of quantity discounts Cycle counting: A. eliminates annual inventory adjustments. This is the correct answer.B. assumes that the most frequently used items must be counted more frequently. C. is a process by which inventory records are verified once a year. D. assumes that all inventory records must be verified with the same frequency.
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Your answer is not correct.E. provides a measure of inventory turnover. ABC analysis divides on-hand inventory into three classes, generally based upon which of the following? A. annual demand B. item quality C. unit price Your answer is not correct.D. the number of units on hand E. annual dollar volume _________________________ Among the advantages of cycle counting is that it: A. allows more rapid identification of errors and consequent remedial action than is possible with annual physical inventory. This is the correct answer.B. does not need to be performed for less expensive items. Your answer is not correct.C. does not require the detailed records necessary when annual physical inventory is used. D. does not require highly trained people. E. makes the annual physical inventory more acceptable to management.
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Which of the following would NOT generally be a motive for a firm to hold inventories? A. to decouple various parts of the production process B. to minimize holding costs This is the correct answer.C. to hedge against inflation D. to provide a selection of goods for anticipated customer demand and to separate the firm from fluctuations in that demand Your answer is not correct.E. to take advantage of quantity discounts ABC analysis is based on the presumption that carefully controlling all items is necessary to produce important inventory savings. True Your answer is not correct. False All EXCEPT which of the following statements about ABC analysis are true?
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