INVENTORY, LOGISTICS AND EXPEDITING QUESTIONS

1. Which of the following describes the relationship between a service level and safety stock?
A. A service level increases in proportion to an increase in safety stock
B. A safety stock is not always required to achieve a required service level
C. A service level decreases in proportion to a decrease in safety stock
D. When safety stock is zero the service level always zero
2. Which of the following describes consignment stock?
A. Supplier stock that is held at supplier premises and only invoiced when delivered
B. Supplier stock that is held at supplier premises and only delivered when called off
C. Supplier stock held at the buyer premises and is only paid for when used
D. Supplier stock held at the buyer premises and invoiced against forecast usage
3. Where would you find the details of the company’s planned products, quantity and the schedule used by
marketing when promising deliveries?
A. Master production schedule C. Net requirement plan
B. Final sales forecast D. Rough cut capacity plan
4. Under the ABC system of inventory, priorities of a class A items are:
A. The 20% of high-value items that account for around 80% of the total stock value.
B. The 80% of high-value items that account for around 20%of the total stock value.
C. The 80% of high-value items that account for around 80% of the total stock value.
D. The 20% of high-value items that account for around 20%of the total stock value
5. Which of the following formulae is used to calculate the order size at a review point?
A. (Safety stock - physical stock - stock on order) + (demand per week - demand over a review interval)
B. (Demand per week + review interval) + physical stock – safety stock on order
C. (Safety stock + service level) - (demand over a lead time + physical stock) – stock on order
D. (Demand over a lead time + demand over review interval) + safety stock - physical stock – stock on
order
6. One of the underlying assumptions of the EOQ model is that:
A. A doubling of demand requires a doubling of the order quantity
B. Demand is unstable and unpredictable so cannot be accurately forecast
C. There is a point where stockholding costs are equal to ordering cost
D. The purchase price per unit varies with the quantity ordered
7. Which of the following is held to increase service levels?
A. Safety stock C. Kanban stock.
B. Work in progress (WIP) D. Obsolete stock
8. Which of the following is a technique used in inventory management?
A. Vendor appraisal C. Pareto analysis.
B. Job analysis D. Quotation analysis

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9. Which of the following is a reason for carrying safety stock?
A. To take advantage of low raw materials prices.
B. To cover unpredictable prices.
C. To take advantage of bulk discounts.
D. To cover unpredictable lead times.
10. A definition of inventory management is:
A. A product orientated technique aimed at minimized inventory and maximizing quality.
B. The process of monitoring stock levels to ensure that neither too much stock is held or too little.
C. The process of reducing stock levels to ensure that there are minimal or no stock.
D. A term used in the United States to describe the application of MRPII or JIT techniques to improve
forecasting accuracy
11. The formula for the cost of sales is
A. Opening stock + purchases
B. Purchases – Opening stock
C. Opening stock + Closing stock – opening stock
D. Opening stock + purchases – closing stock
12. Which of the following is true about acquisition and holding costs?
A. Acquisition costs are equal to holding costs in all organisations
B. Acquisition costs are always higher than holding cost in retail organisation
C. Holding costs are always higher than acquisition costs in retail organisation
D. Holding costs and acquisitions costs vary from organisation to organization
13. Under the ABC system of inventory priorities, a class C is:
A. The 10% of the items that account for around 70% of the usage value
B. The 70% of items that account for around 10% of the usage value
C. The 70% of items that account for around 70% of the usage value
D. The 10% of items that account for around 10% of the usage value
14. When compared to class C items class A items will have:
A. The highest stock and lowest stock turnover
B. The highest stock and highest stock turnover
C. The lowest stock and lowest stock turnover
D. The lowest stock and highest stock turnover.
15. Which of the following describes how net requirements are calculated in MRP system?
A. Net requirements = Gross requirements + stock
B. Net requirements = gross requirements – stock
C. Net requirements = Forecast requirements + stock
D. Net requirement = Forecast requirement – stock

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16. Which of the following describes a periodic stock review system?
A. Items are reviewed when the price is at its lowest
B. Items are reviewed when stock falls to a pre-determined level
C. Items are reviewed at a fixed time interval
D. Items are reviewed to calculate the safety stock
17. Which of the following forecasting techniques will be more sensitive to a change in demand?
A. Simple moving average C. Delphi.
B. 10 point moving average D. Weighted moving average
18. Which of the following describes the bullwhip effect?
A. Small changes in demand lead to a bigger demand upstream in the supply chain
B. Large changes in demand lead to a much smaller demand upstream in the supply chain
C. A large increase in demand leads to stock outs in all the supply chain
D. Large changes in demand lead to a much smaller demand downstream in the supply chain
19. Which of the following is an advantage of random location warehouse layout?
A. Higher rates of warehouse fill
B. Products locations are familiar
C. Products of similar type can be grouped together
D. Manual handling of products can be reduced
20. Which of the following products are suitable for storage in stockyard?
A. Timber lengths C. Copper pipe.
B. Cement bags D. Iron bolts
21. What is the main advantage of RFID over the traditional barcode system for order tracking?
A. It has been in existence longer than barcodes
B. It can store more information than barcodes
C. It is used more extensively than barcodes
D. It is a universal standard like barcodes
22. Which of the following is impacted by value of stock?
A. Insurance premiums C. Customer demand.
B. Acquisition costs D. Reorder point
23. Which of the following is described as closed loop systems?
A. MRP C. EOQ
B. MRPII D. JIT
24. A problem with EOQ model is that:
A. It requires a MRP system to calculate the quantity.
B. Some of the costs are difficult to estimate.
C. It assumes the price breaks occurs at standard quantities.
D. It build in a high safety stock level to allow for suppliers lead time

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25. Which of the following is an advantage of a fixed order point system?
A. Ease of administration and control with predictable workload planning for purchasing and warehousing
staff.
B. Orders may be placed at the same time for a number of items.
C. Ability to use Economic Order Quality (EOQ) model.
D. Ability to identify slow-moving or obsolete stock items, due to periodic stock review
26. Periodic review means:
A. Ordering inventory at a predetermined re-order level.
B. Ordering inventory at a fixed and regular time interval.
C. Ordering inventory when it falls below the designated safety stock level.
D. Ordering inventory in consultation with suppliers relative to their available capacity
27. What would be classified as work in progress in a car assembly plant?
A. Maintenance and repair materials C. Materials handling equipment.
B. Part assembled cars. D. Office equipment
28. Which of the following describes the purpose of using the economic order quantity (EOQ) model?
A. To calculate how much safety stock should be carried.
B. To calculate the re-order level to ensure no stock outs.
C. To minimize the number of deliveries and stock outs.
D. To minimize the total costs of holding and acquiring stock
29. Which of these is a benefit of a good coding system?
A. It prevents duplication of items.
B. It is capable of covering a majority of items.
C. It reduces the possibility of theft of stock.
D. It should be de-centrally con trolled
30. Which of the following are the three major inputs to the MRP process?
A. Management reports, inventory file and master production schedule.
B. Bill of materials, inventory file and master production schedule.
C. Bill of materials, inventory file and net requirements for each item.
D. Inventory file, gross requirements, management reports
31. Which of the following describes the reorder level (ROL) method of stock control?
A. Stock is reviewed on fixed time interval and an order is placed to top up the stock.
B. Stock is reviewed at fixed time and an order is placed for a fixed quantity.
C. When the quantity of stock falls to the predetermined safety stock level, an order is placed.
D. When the quantity of stock falls to a predetermined level a fixed order quantity is placed
32. What is meant by the term obsolete stock?
A. Stock which is low. C. Stock which has become damaged.
B. Stock which has been stolen. D. Stock which has become outdated

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33. Which of the following are all acquisition costs?
A. Purchasing staff time to process order. C. Storage costs
B. Insurance costs against risk of theft. D. Cost of security
34. Which is the reason for holding stock?
A. To allow for unpredictable demand.
B. To reduce the chance of obsolete stock.
C. To reduce the bullwhip effect.
D. To take advantage of bulk buying discounts
35. Which of the following is a cause of obsolescence?
A. Fraud. C. Deterioration.
B. Advancing technology. D. Reduced demand
36. Which of the following inventory methods can help a buyer with cash flow problems?
A. Periodic review. C. Re-order level.
B. Vendor Managed Inventory (VMI). D. Consignment stocking
37. Which of the following describes the meaning of Kanban?
A. Improvement C. Lean
B. Push D. Communication
38. A limitation of the EOQ model is that:
A. It only takes account of holding cost and price.
B. It leads to varying order quantity for each item.
C. It does not take account of shelf life of items in stock.
D. It does not take account of all ordering costs
39. Which of the following is a feature of the Delphi method?
A. Experts meet up and reach a consensus.
B. Statistical data is analyzed to aid prediction.
C. The group interaction is anonymous.
D. It is not useful in single-dimension questions
40. Under the ABC system of inventory, priorities of a class A items are:
A. The 20% of high value items that account for around 80% of the total stock value.
B. The 80% of high value items that account for around 20% of the total stock value.
C. The 80% of high vale items that account for around 80% of the total stock value.
D. The 20% of high-value items that account for around 20% of the total stock value
41. Which of the following describes what happens when a small change in final consumer demand leads to a
much bigger change in demand upstream in the supply chain?
A. Pareto effect. C. Delphi method.
B. Seasonal effect. D. Bullwhip effect

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42. Which of the following is not a cost of acquiring inventory?
A. Executive effort C. Cost of tendering
B. Cost of obsolescence and deterioration D. Cost of stationery
43. If a service level is increased from 98% to 99.9% storage costs will:
A. Half. C. Double.
B. Triple. D. Stay the same
44. Which of the following is not a factor of determining the level of safe stock to be held?
A. The item’s delivery lead time. C. The price of a product.
B. The variability in lead time. D. The variability of demand or usage
45. Which of the following situations is an MRP system most suitable?
A. Fast moving components. C. Dependent demand.
B. Construction projects. D. Independent demand
46. Which of the following definitions best describes the term just in time (JIT)?
A. A continuous flow system. C. A pull planning system.
B. A drop down system. D. A push planning system
47. Which of the following describes the quantity ordered in the periodic review stock replenishment system?
A. The quantity is fixed and constant.
B. The quantity ordered varies and returns the stock to a pre-determined level.
C. The order quantity is based on economic order quantity.
D. The order quantity is estimated by the user
48. Which of the following describes the opportunity cost of holding large stocks?
A. By paying for the stock, we lose the use of the cash paid out.
B. It is the value of the excess stock.
C. It is the value of the total stock held.
D. It is the cost associated with holding the stock
49. Which of the following is a formula for calculating economic order quantity
𝟐 𝑿 𝑨𝒏𝒏𝒖𝒂𝒍 𝒖𝒔𝒂𝒈𝒆 𝑿 𝑼𝒏𝒊𝒕 𝒑𝒓𝒊𝒄𝒆
A. EOQ = √
𝑪𝒐𝒔𝒕 𝒐𝒇 𝒉𝒐𝒍𝒅𝒊𝒏𝒈 𝒔𝒕𝒐𝒄𝒌
𝟐 𝑿 𝑨𝒏𝒏𝒖𝒂𝒍 𝒖𝒔𝒂𝒈𝒆 𝑿 𝑪𝒐𝒔𝒕 𝒐𝒇 𝒑𝒍𝒂𝒄𝒊𝒏𝒈 𝒂𝒏 𝒐𝒓𝒅𝒆𝒓
B. EOQ = √
𝑼𝒏𝒊𝒕 𝒑𝒓𝒊𝒄𝒆
𝟐 𝑿 𝑪𝒐𝒔𝒕 𝒐𝒇 𝒑𝒍𝒂𝒄𝒊𝒏𝒈 𝒂𝒏 𝒐𝒓𝒅𝒆𝒓 𝑿 𝑼𝒏𝒊𝒕 𝒑𝒓𝒊𝒄𝒆
C. EOQ = √
𝑪𝒐𝒔𝒕 𝒐𝒇 𝒉𝒐𝒍𝒅𝒊𝒏𝒈 𝒔𝒕𝒐𝒄𝒌

𝟐 𝑿 𝑨𝒏𝒏𝒖𝒂𝒍 𝒖𝒔𝒂𝒈𝒆 𝑿 𝑪𝒐𝒔𝒕 𝒐𝒇 𝒑𝒍𝒂𝒄𝒊𝒏𝒈 𝒂𝒏 𝒐𝒓𝒅𝒆𝒓

D. EOQ = √
𝑪𝒐𝒔𝒕 𝒐𝒇 𝒉𝒐𝒍𝒅𝒊𝒏𝒈 𝒔𝒕𝒐𝒄𝒌

50. In inventory control, what does RFID stand for?

A. Real finder inventory destination
B. Radio frequency information destination
C. Radio frequency identification
D. Real frequency identification

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51. Which of the following is not a reason for stock valuation?
A. To determine the insurance premium for the goods held in stores.
B. To create general awareness of the cost of inventory among all supplies staff.
C. To determine the supplier’s price before buying a product.
D. To use the information to prepare financial statements
52. Which of the following is a formula for calculating re-order level?
A. Maximum amount used x minimum lead time for replenishment.
B. Maximum amount used x maximum lead time for replenishment + safety stock.
C. Average amount used x average lead time + safety stock.
D. Average amount used x average lead time – safety stock
53. Which of the following best defines ‘moving straight average?
A. A forecasting technique where the average is based on a specific number of data points.
B. A process by which the reorder of an item is triggered by the inventory level dropping to a predetermined
level.
C. A forecasting technique where each demand is multiplied by a weighting factor.
D. A process by which a decision is taken at a period end or review point to determine how much to reorder
54. Which of the following is a qualitative method of forecasting demand?
A. Trend analysis. C. Simple moving average.
B. Moving weighted average. D. Delphi method
55. Which of the following is a quantitative approach to demand forecasting?
A. Pareto analysis. C. Delphi method.
B. Average cost. D. Moving straight average
56. Which of the following is an example of a subassembly?
A. Aluminum and steel in a manufacturer of car bodies.
B. Fixings, switches and bearings used in manufacturing.
C. Gearboxes and suspension units used in car manufacturing.
D. Lubricants and solvents that are used but are not part of the final product
57. Which of the following techniques takes into account that older figures are less reliable guide to the future than
more recent figures?
A. Simple moving average. C. Weighted average.
B. Trend analysis. D. Delphi method
58. Which stock valuation method uses estimates in its calculation?
A. Average costing C. First in first out.
B. Last in first out. D. Standard costing
59. Which of the following impacts upon the quantity of safety stock held?
A. Variability in demand. C. Variability in prices from suppliers.
B. Stock valuation method. D. Cost of placing an order

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60. Independent demand is…..
A. Not dependent upon the demand for anything else.
B. Dependent upon final product demand.
C. Forecast using MRPII.
D. Not affected by season variation
61. Which of the following is a major disadvantage of FIFO?
A. It does not give a fair commercial valuation of the stock balance in published accounts.
B. It is not as popular in practice as LIFO and therefore staff may be unfair with its use.
C. It is cumbersome in operation particularly if there are many changes in purchase prices.
D. It makes the use of reorder point and periodic review stock control difficult to use
62. How is gross profit calculated?
A. Total of all sales minus closing stock C. Total of all sales minus purchases.
B. Total of all sales minus opening stock. D. Total of all sales minus cost of sales
63. Consignment stocking is described as stock………..
A. Delivered only as required. C. Delivered to forecast.
B. Invoiced when received. D. Involved when used
64. A code that uses a check digit in order to reduce errors is known as…..
A. Self-checking. C. Self validating.
B. Auto validating. D. Auto checking
65. What types of products should be stored in cantilever racking?
A. Boxes of cereal. C. Screws and washers.
B. Long steel pipes. D. Boxed stationery items
66. A commonly used barcode system is known as EAN. What do the letters stand for in this case?
A. Eurasian Article Numbering C. European Article Numbering
B. European Arranged Numbering D. European Access Numbering
67. In electronic product code (EPC), which element contains the information of the company?
A. Manager number. C. Serial number.
B. Object class. D. Article number
68. A layout that minimizes the movement of goods and people is known as?
A. Dynamic. C. Static.
B. Ergonomic. D. Harmonic
69. In warehouse automation what do the letter AVG stand for?
A. Advanced Guided Vehicle. C. Automated Guided Vehicle
B. Automated Ground Vehicle D. Automatic Ground Vehicle
70. Four way and two way are types of what?
A. Racking. C. Pallets.
B. Storage. D. Packaging

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71. Which of the following is measure of efficiency in a warehouse?
A. The number of inventory checks in a warehouse.
B. Utilization of part in the warehouse.
C. Utilization of space in warehouse.
D. The value of inventory stored in warehouse
72. Which of the following is a cost of not being able to continue operations?
A. Cost of capital. C. Opportunity cost.
B. Cost of heating and lighting. D. Cost of damage.
73. Spot buying is suitable for which type of relationship?
A. Partnership. C. Strategic alliance.
B. Single sourced. D. Transactional
74. Which INCOTERM 2010 requires the seller to pay the expenses of delivering goods from their premises to the
port of distribution with the buyer providing the marine insurance?
A. CIF C. CFR
B. CPT D. CIP
75. Which of the following is the name given to a Bill of lading where the goods have been received without
defects?
A. Claused bill of lading. C. Spotless Billy of lading.
B. Clean bill of lading D. Complete bill of lading
76. Procure to pay (P2P) systems are generally integrated with…….
A. Accounts available C. HR payroll
B. Sales forecast D. Accounts payable
77. AVB security group sends highly confidential information to suppliers using emails to guarantee
confidentiality is maintained. AVB ensures its emails are……….
A. Coded C. Wired
B. Scrambled D. Encrypted
78. Which of the following is used by a buyer to express their desired quality standards to the supplier?
A. SLA C. BOM
B. MRP D. EOQ
79. Which of the following will exist within a procure to pay (P2P) system to ensure that internal budgets and sign
off procedures are adhered to?
A. Approval hierarchy C. Manual intervention
B. Purchase orders D. Bill of materials
80. Using the internet to make decisions and form strategies regarding how and where services or products are
obtained is called?
A. E-sourcing C. E-tendering
B. E-catalogues D. E-auctions

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81. Which of the following is not a cost of acquiring inventory?
A. Executive effort. C. Cost of tendering.
B. Cost of obsolescence and deterioration. D. Cost of stationery
82. Which of the following will be found in the inventory file?
A. Indirect materials stock. C. End product requirements.
B. Components requirements for end product. D. Order outstanding
83. When designing movement in warehouses, designer’s try to maximise which of the following?
A. Accessibility. C. Space utilisation.
B. Throughput. D. Location
84. Which of these could be described as an employeers concern when choosing a warehouse location?
A. Low overhead costs. C. Located close to public transport
B. A short travel to work/commute distance. D. Located close to shops.
85. 5854 JKL can be descibed as an example of what type of code?
A. Color. C. Bar.
B. Numeric. D. Alphanumeric
86. Which approach to coding is used on products such as very small electrical components?
A. Bar coding. C. Color coding.
B. Symbolic coding. D. EPC coding
87. In relation to the packing and movement of hazardous goods what do the lettes DGSA stand for?
A. Dangerous goods safety abroad. C. Dangerous goods safety assessor.
B. Dangerous goods signs affixed. D. Dangerous goods safety advisor
88. In environmental terms which of the following would be as packaging?
A. Tea bags. C. Pots for houseplant.
B. Drinks stirrers. D. Bubble wrap around fragile items
89. In terms of information systems what does EDI stand for?
A. Electronic data interface C. Electronic data interchange.
B. Electronic digital interchange. D. Electronic data interface
90. Packaging inteneded for composting should be:
A. Made from plastic. C. Made form metals.
B. Biodegrade. D. Free from damage
91. Which type of warehouse racking is this a description of ………designed for storing large quantities of similar
pallets. These are stored depth wise, behind each other, on continues pallet-supporting rails.
A. Adjustable pallet racking. C. Cantilever racking.
B. Drive-in racking. D. Fixed pallet racking
92. One of the main factors influencing the internal layout of a warehouse is….
A. The purpose of the warehouse. C. The cost of handling equipment.
B. The location of the warehouse. D. The number of employees.

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93. Which of the following is a key factor to consider in the design of stockyards?
A. Services. C. Shelving.
B. Structure. D. Surface
94. In the context of a container transport what do the letters ‘TEU’ stand for?
A. Thirty foot equipment unit. C. Twenty foot equivalent unit.
B. Ten foot equivalent unit. D. Twelve foot equivalent unit
95. Which of the following is a consignment note with a standard set of transport and liability conditions used in
road haulage?
A. CIF C. CIM
B. CMR D. CFR
96. Which of the following class of incoterms 2010 places the most responsibility on the buyer?
A. C C. F
B. D D. E
97. Which of the following can be defined as the efficient movement of finished product from the end of the
production line to the customer and in some cases includes beginning of the production line?
A. Logistics. C. Materials management.
B. Distribution D. Procurement
98. A document that covers the use of more than transport mode between the exporters’ premises and the
customers’ premises is known as?
A. Combined transport bill of lading C. Combined mode bill lading.
B. Complete bill of lading. D. Claused bill lading
99. An ‘air waybill’ provides evidence of what?
A. Title to the goods C. Export clearance
B. Loading on the aircraft D. Conditions of carriage
100. Which of the following is an advantage of leasing a warehouse as opposed to owning one?
A. It allows increased control. C. It is an organizational asset.
B. It can increase in value. It allows better flexibility D. It is an organizational asset.
101. What happens to storage costs as the number of warehouses an organisation has increases?
A. They decrease. C. It depends on warehouse location.
B. They increase D. They stay the same
102. What is the name of non-structural floors that can be placed inside warehouse?
A. Midi floor C. Mezzoforte floor
B. Mobile floor D. Mezzanine floor
103. Which of the following is a benefit for unitizing loads?
A. Reduced use of space C. Additional security
B. More handling D. Increased movement

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104. Which of storage allows goods to move via rollers using gravity?
A. Live storage C. Drive storage
B. Fixed storage D. Random storage
105. In warehouse picking, what type of picking does the following describe? Stock items are separated by
classification, personnel will collect them from the storage area and take them to a marshalling area where the
consignment is consolidated’
A. Sectional picking C. Random picking
B. Travelling picking D. Mobile picking
106. Which of the following INCOTERMS 2010 is used only for sea and inland waterway transport?
A. FAS C. CIP
B. FCA D. CPT
107. Which of the following represents the abbreviation ICC?
A. International commercial compliance C. International chamber of commerce.
B. International chamber of compliance. D. International countries committee
108. Which of the following describes dunnage?
A. Additional packaging to protect a fragile cargo
B. A type of packaging case used for fragile cargo
C. A type packing case used for heavy cargo
D. Additional packaging to help display the cargo
109. Which of the following INCOTERMS 2010 gives the most responsibility?
A. DAT C. DDP
B. DDU D. DAP
110. Historical data’ is especially useful in which of the following?
A. Demand forecasting C. Approving contracts
B. Expediting D. Ordering
111. What is the abbreviation used for the aluminum containers used in airfreight operations?
A. ULC C. ULB
B. ULD D. ULP
112. A disadvantage of a significant coding system is that:
A. It is inflexible and cannot be expanded
B. The cost of installation can be high
C. It requires a separate catalogue of codes
D. It does not allow the user to recognize the product
113. Racking mounted on rails which moves up and down the warehouse floor is known as….
A. Mobile racking C. Fixed racking
B. Random racking D. Motion racking

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114. Which of the following costs decreases as the number of depots increases?
A. Purchase costs C. Transport costs
B. Storage costs D. Inventory cost
115. Which of the following refers to warehouses that serve a number of retail outlets?
A. Logistics warehouse C. Factory warehouse
B. Bulk warehouse D. Distribution warehouse
116. Which of these products would use a serial number to enable it to be individually tracked?
A. Printer paper C. Light bulbs
B. Televisions D. Books
117. Which of these is political influence on warehouse location?
A. Grants and regional aid C. Quality workforce
B. Road network proximity D. Types of goods produced
118. A storage system where items are stored directly on top of each other is known as?
A. Block stacking C. Pyramid stacking
B. Random stacking D. Fixed stacking
119. What do the letter EPC stand for?
A. Electronic Product Code C. Electronic Placement Consolidation
B. Electronic Placement Code D. Electronic Product Consolidation
120. In warehousing, what does RDC stand for?
A. Returns Distribution Centre C. Regional Dispersing Centre
B. Regional Distribution Centre D. Returns Delivery Centre
121. Plastic storage bins fitted to a louvered panel are suitable for storing what type of products?
A. Long objects C. Heavy objects
B. Large objects D. Small objects
122. Which warehouse layout has goods in and goods out on the same side of the building?
A. Corner flow C. Cross flow
B. Through flow D. Reverse flow
123. Which of the handling system uses a single overhead rail with hooks and small trolleys can be attacked to?
A. Monorail C. Duo rail
B. Conveyer D. Shute
124. Pallet trucks and platform trucks are types of what warehouse handling system?
A. AVGs C. Forklift trucks
B. Warehouse trolleys D. Reach trucks
125. In terms of packaging which of these is seen as a combustible organic material?
A. Cardboard C. Plastic
B. Lead D. Metal

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126. What is the name of the process where waste packing is allowed to biodegrade?
A. Composing C. Compacting
B. Composting D. Completing
127. A symbolic coding system uses what to represent the product?
A. Pictures or letters. C. Letters or numbers.
B. Diagrams or numbers. D. Pictures or diagrams
128. Keeping the warehouse aisles clear of rubbish is an example of what?
A. Good communication. C. Good housekeeping.
B. Good systems. D. Good procedures
129. Which of the following is an advantage of owning a warehouse as opposed to leasing one?
A. Increased control. C. Long term flexibility.
B. Financial efficiency. D. Reduced financial risk
130. Which warehouse layout has goods in and goods out at 90 degrees to each other?
A. Corner flow C. Cross flow
B. Through flow D. Reverse flow
131. Which of the following is an advantage of fixed location storage?
A. High rates of warehouse fill.
B. Staff familiarity of layout.
C. Computerized stock location is necessary.
D. Products are always in a different location
132. Which of the following would be used to track an individual item for example a television?
A. Serial number C. Batch number
B. Stock number D. Block number
133. Which of the following needs to be considered when selecting the location of a store or a stockyard?
A. Staff comfort C. Visual appearance.
B. Internal layout D. Environmental issues
134. Why would a country be particularly interested in regulating wooden packing?
A. To reduce the impact on the environment.
B. To comply with ISO standards.
C. To keep out unwanted pests.
D. To help reduce the overall consignment weight
135. Which of the following incoterms is used where goods are picked up or collected at the seller’s factory
A. EXW (EX-Works) C. CIF (Cost, Insurance and Freight)
B. FOB (Free On Board) D. DAT (Delivered at Terminal)
136. What types of products could be stored in Cantilever racking?
A. Boxes of cereal C. Screws and washers
B. Long steel pipes D. Boxed stationery items

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137. Which of these is seen as an advantage of multi-storey warehouses when compared to single storey
warehouses?
A. Less heat loss C. More flexible layout.
B. Lower handling costs D. Lower building costs
138. A coding system that uses pictures or diagrams is known as what type of system?
A. Alphanumeric C. Self-validating
B. Significant D. Symbolic
139. Which of the following categories of material handling equipment does a counterbalance type belong to?
A. Gravity conveyer C. Forklift trucks
B. Picking robot D. Warehouse trolley
140. Which type of cost would the labour cost in assembling a specific item be?
A. Direct C. Indirect
B. Total D. Variable
141. Re-order quantities should consider which of the following?
A. Freight cost for shipment C. Pallet standard load
B. Cost unload the shipment D. Price break for quantity ordered
142. What is the name of one of the newest generations of electronic system used to manage inventory and
ordering?
A. MRP C. MRPII
B. ERP D. Legacy
143. Explain what does S&OP stands for.
A. Stock and ordering procedure C. Sales and operations planning
B. Safe and orderly procurement D. Sales and office procurement
144. When the responsibility is transferred from the seller to the buyer when the seller releases the goods to the
buyer at the port or designated point, the best incoterms to use is which of the following?
A. FOB (Free On Board) C. DAP (Delivered at Place)
B. FAS (Free Alongside Ship) D. DDP (Delivered Duty Paid)
145. Identify which of the following is an ordering system
A. The computer system used to order materials or products.
B. The process of raising a purchase order.
C. The overall procedure to plan both the timing and size of purchase orders.
D. The calculations to identify order point and safety stock
146. Identify three advantages of transporting goods by rail
A. Rail gauge is standard across different countries.
B. Suitable for transporting heavy loads.
C. Suitable for transporting hazardous materials.
D. Enables a single door-to-door journey. Avoid bridge limitations

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147. A document required by customs officials that identifies the country of origin of imported goods, and is
certified by the supplier’s country’s designated authority, to authenticate the source of the goods is called ….
A. Bill of lading C. Custom bond
B. Certificate of origin D. Import declaration
148. In which of the following incoterms is the seller responsible for arranging transportation but will be acting at
the risk and the expense of the buyer?
A. FCA (Free Carrier). C. CPT (Carriage Paid To)
B. CFR (Cost and Freight) D. EXW (EX-Works)
149. How is inventory usually measured
A. By weight. C. By cost.
B. By size. D. By quantity
150. Which definition best describes a re-order point
A. When a replenishment order is made.
B. When a customer makes an order.
C. When there is no stock.
D. When an item is decided to be unsellable
151. Which definition best describes a stock out?
A. When a replenishment order is made.
B. When a customer makes an order.
C. When there is no stock.
D. When an item is decided to be unsellable
152. If expediting is a common process, what would this indicate to a business?
A. The items are extremely popular.
B. There is a weakness or failure in the business process.
C. The items are being sold too cheap.
D. Customers don’t like rival products
153. What is a name given to the document that identifies the materials needed to produce a final product?
A. Catalogue C. Master production schedule.
B. Bill of materials. D. Bill of lading
154. Which of the following methods of forecasting is best suited for a new product where no historical data is
available?
A. Time-series analysis. C. Qualitative methods.
B. Casual models. D. Quantitative methods
155. What does ERP stand for?
A. Energy Requirements Planning C. Enterprise Resource Planning
B. Enterprise Requirements Planning D. Energy Resource Planning

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156. The buyer bears all the transportation costs and the risk of loss of goods in which of the following types of
incoterms?
A. FCA (Free Carrier) C. CIP (Carriage and Insurance Paid To)
B. FAS (Free Alongside Ship) D. DDP (Delivered Duty Paid)
157. What does MRPII stand for?
A. Manufacturing Requirements Planning
B. Material Requirements Planning
C. Manufacturing Resource Planning
D. Manufacturing Requirements Planning
158. Which of the following forecast techniques is based on the skills of geographically dispersed experts?
A. Average method C. Simple moving average
B. Weighted moving average D. Delphi qualitative method
159. Which of the following describes a stock Level system?
A. Items are reviewed when the price is at its lowest
B. Items are reviewed when stock falls to a pre-determined level
C. Items are reviewed at a fixed time interval
D. Items are reviewed to calculate the safety stock
160. MRP is a computer package for the scheduling of..?
A. Independent demand items C. Lean inventory items
B. Dependent demand items D. Agile inventory items
161. MRPII differs from MRP by..?
A. Having the ability to do more than MRP as it can plan for independent items
B. Can plan for ordering and transportation
C. Plans for inventory and also for resources to work on the inventory
D. MPR II plans for only materials deliveries.
162. Which of the following situations is likely the most damaging (costly) with respect to a stockout?
A. Buyer buys a substitute product which yields high profit
B. Buyer buys a substitute which lowers the seller’s profit
C. The buyer goes to a competitor to buy the out stock of item
D. The customer waits for the item to be in stock
163. Which of the following describes the re-order level (ROL) method of stock control?
A. Stock is reviewed on a fixed time interval and an order placed to top up the stock
B. Stock is reviewed at affixed time and an order is placed for a fixed quantity
C. When the quantity of stock falls to the safety stock level a fixed order is placed
D. When the quantity of stock falls to a predetermined level a fixed order quantity is placed
164. Which of the following is an example of indirect supplies for a motor manufacturer?
A. Raw materials C. Subassemblies
B. Stationery items D. Parts and components

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165. Which of the following is a situation when there is an advantage in buying materials in bulk?
A. Where space is limited to store extra stock
B. Where the cost of depreciation is high
C. Where supplier discounts are available
D. Where redundancy of stock is a problem
166. Economic order quantity can be described as…
A. The minimum quantity that can be bought to achieve a discount
B. The quantity to be ordered that minimizes total costs
C. The quantity to order to maximize space used and minimize service level
D. The quantity to order to avoid all costs of finance and maintain supply
167. In which of the following incoterms is buyer’s responsibility to cover insurance from the port to the final
destination?
A. FAS (Free Alongside Ship) C. CIF (Cost, Insurance and Freight)
B. CFR (Cost and Freight) D. DAP (Delivered at Place)
168. Which is true of direct supplies?
A. They are used to maintain equipment
B. They impact on the quality of good produced
C. They relate to the general running of the business
D. They involve a range of overheads
169. Which of the following is a guarantee from the surety company ,(usually an bank or insurance company) to
government that the importer will follow all import laws and regulations of that country?
A. Custom bond C. Customs tariff
B. Customs invoice D. Import license
170. Which of the following is true?
A. Obsolescence and redundancy occur for the same reasons
B. Redundancy and obsolescence can be avoided by accurate forecasting
C. Redundancy and obsolescence lead to reduced stock levels
D. Redundancy and obsolescence only occur in retailing
171. Which of the following is true of warehouse insurance premiums?
A. Increase as stock space is used more effectively
B. Decrease as less obsolescent stock is held
C. Decrease as stock space is used more efficiently
D. Increase as stock value increases
172. Which of the following is an example of direct supplies for a retailer?
A. Items that are general running expenses C. Items for resale
B. Items sourced from a wholesaler D. Items sourced locally

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173. Which of the following is true of a warehouse?
A. A warehouse needs to be as full as possible to ensure the correct service level
B. A warehouse needs to only be as full as it needs to be to ensure required service level
C. The use of space in a warehouse is a measure of service level and stores efficiency
D. The warehouse should be always built too large for foreseeable requirement
174. The type of incoterms where the buyer is responsible for insuring the goods from the seller’s premises and the
seller is responsible for insuring the transportation mode used is which of the following?
A. CIF (Cost, Insurance and Freight) C. DAP (Delivered at Place)
B. CIP (Carriage and Insurance Paid To) D. DDP (Delivered Duty Paid
175. The purchase of important direct supplies is likely to involve which type of buyer/ supplier relationship?
A. Short-term C. Long-term
B. Transactional D. One-off
176. Costs relating to indirect supplies are often referred to as which of the following?
A. Cost of sales C. Indirect revenue costs
B. Purchasing costs D. Overheads costs
177. A document used for short range deliveries between suppliers and buyer or when products are
transferred between company depots is referred to as which of the following?
A. Custom entries C. Import merchant
B. Delivery docket or note D. A letter of credit (LC)
178. Which of the following describes how costs lost through obsolescence might be mitigated?
A. More use of technology in the design
B. Purchasing larger quantities of items for stock
C. Increasing the range of stock held
D. Selling the item secondhand
179. Which of the following is a computer system that analyses the current inventory forecast demand and expected
delivery of new supplies to calculate demand and identify requirements from suppliers?
A. Activity Based Classification (ABC)
B. Maintenance, repairs and operations (MROs).
C. Economic order quantity(EOQ)
D. Enterprise Resource Planning (ERP)
180. Which of the following will help an organisation to more accurately predict its future requirements?
A. Supplier selection C. Stakeholder analysis
B. Vendor rating D. Market knowledge
181. Subjective forecasting techniques are based on which of the following?
A. Historical data C. The judgment of experts
B. Facts about the market D. Changes in sales volumes

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182. Which of the following contracts requires close expediting?
A. Low value routine items
B. Parts which are widely available form a range of suppliers
C. A critical component on which safety stocks are low
D. Items for which a large stock is already held
183. For the Delphi method to succeed the organisation is dependent on which of the following?
A. Using historical data C. Finding a suitable panel of experts
B. Correctly extrapolating facts D. Working out the weighted average
184. A key function of the expediter is to:
A. Ensure specifications are correct C. Negotiate price reduction
B. Measure the supplier’s performance D. Manage the timing of supply
185. In which of the following incoterms is the shipper/seller's responsibility to insure the goods and absorb all
costs and risks including the payment of duty and fees.
A. CPT (Carriage Paid To) C. DAP (Delivered at Place)
B. DAT (Delivered at Terminal) D. DDP (Delivered Duty Paid)
186. Which of the following is a document stating an agreement between the buyer’s and seller’s bank to transfer
funds which relate to the exchange for goods or services in a contract?
A. Import license C. A letter of credit (LC)
B. Invoice D. Proforma invoice
187. In trend analysis where the rise and fall are difficult to predict, the trend is said to be:
A. Fluctuating C. Falling
B. Rising D. Steady
188. The amount of stock and the value of materials on hand at the beginning of a set period such as the start of an
accounting period is referred to as which of the following?
A. Safety stock C. Redundant stock
B. Opening stock D. Finished goods
189. For forecasting, Maryland Manufacturing Corporation uses a panel of experts who have respected opinions
about the market. This forecasting technique is:
A. Subjective C. Objective
B. Quantitative D. Extrapolated
190. Which of the following is not a direct cost of an organisation?
A. Cost of storage space C. Cost of materials
B. Cost of labour D. Stationery costs
191. Which of the following is not a method of measuring inventory?
A. Specific identification C. Just in time (JIT)
B. First in, First out (FIFO) D. Weighted average.

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192. Which of the following is not used to ensure compliance with legislation and regulations for supplies from
international sources?
A. Domestic importation regulations C. Hide information about the country’s regulations
B. Awareness of cross-border issues D. Restricted or prohibited items
193. Which of the following is a standardized customs form used to control goods arriving from outside EU and
being exported outside the EU?
A. Import merchant C. Single administrative document
B. Purchase order D. Waybill (or airway bill)
194. How might an expediter solve or even avoid problems?
A. Remain focused on the specification C. Identify internal stakeholders
B. Be familiar with the terms and conditions D. Regular communication with suppliers
195. Which of the following contracts requires close expediting?
A. Low value routine items
B. Parts which are widely available form a range of suppliers
C. A critical component on which safety stocks are low
D. Items for which a large stock is already held
196. Which of the following should the expediter avoid?
A. Direct contact with suppliers
B. Asking for notification of dispatch of goods
C. Reviewing project schedules
D. Micro-managing the supplier
197. What is the purpose of field expediting? To:
A. Help the supplier manufacture the goods C. Inspect the goods on site
B. Conduct primary research on the supplier D. Negotiate price reductions
198. Which of the following is an essential requirement of JIT?
A. Zero defects C. Computerized planning and ordering
B. High stock D. Global suppliers
199. An example of multi-channel communications is……
A. Using the phone, internet and paper forms of communication
B. Using several different email accounts communicating
C. Using different styles of letterheads
D. Communicating with suppliers in different languages
200. Disruption in communications which prevent messages from being clearly understood by the recipient are
known as ……….
A. Transmission C. Noise
B. Regression D. Distortion

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