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Inventory Production Control

Involves managing and optimizing inventory levels, production schedules, and resources to ensure smooth operations and meet customer demands efficiently.

















The two basic questions in inventory management are

  • how much to order and when to order

Work measurement is not useful for choosing between two alternate methods of production.

  • True
  • False

The reorder point is the:

  • Highest amount of stock
  • Lowest amount of stock
  • Average daily use
  • Historical data

Total storage cost = ?

  • average inventory x ordering cost per unit
  • average cost x storage cost per unit
  • storage cost + carrying cost
  • number of times orderd x cost per order

Of all the work measurement techniques the most widely used techniques is________.

  • Time study
  • Production study

The effectiveness of sequencing model technique ________ if the company has backlog of

  • Decreases
  • Increases

Forecasting is function of ________.

  • Chief Executive officer
  • Marketing department

In alternate routing, the delayed job may be routed to a ________ machine where rate of production is faster.

  • Costlier
  • New

As the quantity increases, the procurement cost :-

  • Reduces
  • Increases

Annual Ordering cost is inversely related to the order quantity.

  • TRUE
  • No relationship between the two

Flexibility and product variety are not inter-related with each other.

  • True
  • False

C type items would never be vital under VED analysis.

  • True
  • False

Transit time for manufactured items should be considered only when it is insignificant.

  • True
  • False

In check list approach, ________ rating indicates that existing PPC system requires some major improvements in indicated areas.

  • Good
  • Poor
  • Fair
  • Bad

The sourcing of vendors in case of 'B' type of items is :-

  • Medium
  • Minimum

The tooling data is prepared in respect of following measuring instruments :-

  • Vernier gauge
  • Vernier caliper
  • Micrometer screw gauge
  • Strain gauge

XYZ analysis helps to identify few items which account for large amountof money locked up in the stock and take steps for liquidation /reduction.

  • True
  • False

PERT terminology uses words like :-

  • Precedence diagram
  • Network diagram
  • Events
  • Slack

________ is the sum of set up time and run time.

  • Lead time
  • Manufacturing time

Generally for ________ flow system, Heuristic method is preferred.

  • Intermittent
  • Continuous

Given a decision for designing a line layout, major problem issubdividing a work so that smooth flow can result. The subdivisionprocess is called :-

  • Line balancing
  • Assembly line
  • Load balancing
  • Step or task constraint

________ inventories help to balance company's supply with market demand.

  • Unfinished goods
  • Finished goods

Which of the following is not an element of a distribution system?

  • Purchasing
  • Receiving
  • Storage
  • Patient charging

LOB has advantage that it is more ________ oriented than MRP.

  • Practical
  • Customer

Subsidiary orders include :-

  • Material Order
  • Material Order
  • Shop order
  • Inspection order

In CPM, use of dummy activities is much essential .

  • True
  • False

The non-mathematical rationale of the assignment method is one of minimizing opportunity costs.

  • True
  • False

The software for CPA would require the following parameters:-

  • Algorithms
  • Algorithms
  • Program code
  • Database

Random fluctuation is addition of cyclical fluctuation and seasonal fluctuation.

  • True
  • False

Reorder level determines how low inventory should be before reordering occurs.

  • TRUE

Using the basic EOQ model, if the ordering cost triples, then the new order quantity will

  • Increase about 73%
  • Increase about 3%
  • Decrease about 73%
  • Decrease about 3%


  • percentages of a whole purchase
  • control process to the production
  • reduce labor costs involved

In replenishment system, the fixed order quantity system is also called by following names :-

  • Fixed order system
  • Fixed order system
  • Max-min system
  • Min-max system
  • Re-order point system

Buying for C quantities should be made in ________ quantities .

  • Small
  • Large



The variable costs per unit of holding an item in inventory for a specific period of time.

  • order costs
  • carrying costs
  • total cost of inventory
  • transaction cost

Orders with ________ slack time remaining per operation are run first.

  • Shortest
  • Longest

The minimum requirements for application software for line balancing are as follows :-

  • 1 Ghz processor
  • 1 Ghz processor
  • 2 Ghz processor
  • 1 Gb hard Disk free memory
  • 2 Gb hard Disk free memory
  • Windows or equivalent operating system



The cost involved in subcontracting some of the operations of item outside the home plant is called :-

  • Outside operations cost
  • Outdoor cost

LOB is a manual planning and scheduling technique similar in nature to MRP [Material Resource Planning].

  • True
  • False

Scheduling can be considered as a process of :-

  • Determining time required for each operation
  • Fitting shop order into uncommitted time available for a machine

Move orders, released for material movement from stores to first work center are used for following types of organizations :-

  • Big steel plants
  • Big steel plants
  • Power plants
  • Heavy machinery manufacturers

Installed capacity :-

  • Can be equal to or less than licensed capacity
  • Cannot be equal to or less than licensed capacity

Following difficulties are faced by SDE analysis :-

  • Less delivery period
  • More delivery period
  • Geographical location of supplier
  • Reliability of suppliers

HML Analysis helps to :-

  • Access storage & security requirements
  • Access storage & security requirements
  • Keep control over departmental head level
  • Controls carrying cost
  • Determine frequency of stock verification

The make-or-buy decision is not taken only at starting of a factory but has to be reviewed continuously.

  • True
  • False

An effective case cart system requires:

  • Little space
  • Infrequent cleaning of carts
  • The user to enter a code
  • Good communication

Effective capacity per period is calculated as :-

  • Multiplication of net capacity with labour efficiency
  • Multiplication of net capacity by utilization index

Supplies should never be stored

  • On wire carts
  • In a closed cabinet
  • 8 inches off the floor
  • On the floor

In ABC analysis, the classification is based on :-

  • Carrying cost
  • Cumulative cost

The 'G' group of GOLF analysis involves moderate delivery time and availability of credit usually in the range of 30 to 60 days.

  • True
  • False

Good quality and ________are the two main requirements to secure maximum business from a customer.

  • Fixed rates
  • Competitive rates

Among different types of costs associated with inventory, the opportunity cost of the investment tied up in inventory is a(n) ________.

  • purchasing cost
  • ordering cost
  • stockout cost
  • carrying cost

PERT uses linear programming and probability concepts for planning and controlling activities.

  • True
  • False

Work measurement is responsibility of :-

  • PPC
  • PPC
  • Material department
  • Industrial engineering
  • Production department

If more variety is to be manufactured, the manufacturing facilities would have to be :-

  • Expanded
  • Commonised

In PERT, use of dummy activities is not much essential.

  • True
  • False

What shall be the consequence of acceptance of frequent rush orders by sales department?

  • Delivery failure
  • Disturbed scheduling

On completion of work the job card is returned to production planning and control department for reference and record.

  • True
  • False

To operate fixed order quantity system, following parameters are required to be fixed:-

  • Standard reorder quantity
  • Standard reorder quantity
  • Re-order point
  • Maximum stock
  • Minimum stock

The Heuristics approach has a base of binary number theory.

  • True
  • False

Negative value of critical ratio :-

  • Indicates shortfall in scheduled delivery period
  • Is meaningless

The ordering cost per order is $400, and the carrying cost per unit is $10. What is the optimal order size considering an annual demand of 2000 units?

  • 400
  • 200
  • 800
  • More info is needed.

Detachable ticket, after filling in required information is :-

  • Placed in a tray/box
  • Given to progress section

Overtime can be avoided in many ways and they are :-

  • Acceptance of too many rush order
  • Acceptance of too many rush order
  • Unrealistic delivery date
  • Insufficient manpower or machines
  • Excessive machine breakdown

________ is a production line made up of operations that form or changethe physical or sometimes chemical characteristics of a product.

  • Fabrication line
  • Assembly line

Stock of finished goods are based on :-

  • Marketing forecast
  • Sales forecast

A progress card normally contains ________ squares.

  • Less than 25
  • Less than 35
  • Less than 40
  • Less than 55

Process Sheet contains following information :-

  • Material Specification
  • Material Specification
  • Sequence of operation
  • Order Quantity
  • Skill of Labour

Transportation carts should be claned at least

  • Daily
  • Weekly
  • Monthly
  • Hourly

Steps involved in process planning include the following :-

  • Enlist feature influencing selection of manufacturing process
  • Enlist feature influencing selection of manufacturing process
  • Indent requirement of tooling and fixtures
  • Prepare sequence of basic operation
  • Write down route sheet



Moving average method lags behind the latest trend.

  • True
  • False

If efficiency is more, the manufacturing time required for completion of job would be generally :-

  • More
  • Less

The queue time is intended to compensate for the time for which the job has to :-

  • Wait near the machines for its turn until other jobs ahead of it are completed.
  • Wait near the machines for its turn until other jobs ahead of it are completed.
  • Wait until inspection and storage is completed.
  • Lie after its completion till is picked up and moved to next machine/work center.
  • Spend extra time due to emergent situations

Earliest possible occurrence time [ I.e. stray time ] of activity [ies ] emanating from the

  • Event time
  • Mean time
  • Lead time
  • Earliest event time

If Kwh consumption per 100 pieces is 8.01 and cost/kwh is Rs 0.80 thecost of power over the year for 40000 pieces with 2000 numbersrejection would be Rs ________.

  • 2691
  • 2692
  • 2693
  • 2695

The make-or-buy decision is not related with profit of the factory.

  • True
  • False

Short term forecasts are for ________.

  • Material Planning
  • Sales forecasting

A type items are always vital under VED analysis.

  • True
  • False

Increase in inventory carrying cost increases EOQ.

  • True
  • False

The most efficient distribution system is the:

  • Par level
  • Total exchange cart
  • Demand
  • Just-in-time

In replenishment system, the type of ordering is either according to "stock level" or "pre-fixed time scale".

  • True
  • False

Physical Count method of collecting information from manufacturing shops is applicable in following situation :-

  • Workshops employing few machines
  • Workshops producing small parts in huge quantities

The assignment algorithm was developed by a Hungarian mathematician named :-

  • Denes Konig and Jeno Egervary
  • Kuhn-Munkres
  • Ford and Fulkerson
  • Carl Gustav Jacobi

Progressing is only a substitute for poor planning.

  • True
  • False

Finished goods inventory is the amount of manufactured product in stock that is available for sale.

  • TRUE

Smoothing performs following activities:-

  • Reallocation of resources
  • Reallocation of resources
  • Conducting Load flow analysis
  • Improving utilization of resources
  • Conducting Heuristic approach

The assignment method is also called as :-

  • Weighted average method
  • Heuristics method
  • Physical count method
  • Hungarian Method

The light engineering company has one special purpose facing ¢ering machine And one copying lathe. The foreman has five workorders for processing . The operation Sequence is fixed [ each job isfirst faced and centered and then copy turned ] . The standard Hoursrequired for each machine to process each work order are shown in thefollowing Table :- Work Order Processing Time [Hours ] Facing ¢ering machine Copying Lathe I 16 40 II 30 60 III 20 6 IV 15 16 V 2512 find sequence to minimize requirements of machine hours.


In precedence diagram the length of arrow has very high degree of significance.

  • True
  • False

The computerized locked supply system is a variation of the :

  • Just-in-time system
  • Case cart system
  • Par level system
  • Demand system

In order to complete a project on time, each critical activity need not be completed in time.

  • True
  • False

Exponential smoothening is weighted average method.

  • True
  • False

Some of significant characteristics of fixed order quantity system under replenishment systems are as follows :-

  • Safety stock is kept to take care of increase in demand during lead time as well as to meet demand when lead time is extended.
  • Safety stock is kept to take care of increase in demand during lead time as well as to meet demand when lead time is extended.
  • Re-order level equals safety stock plus average consumption during lead time
  • Average inventory equals safety stock plus half of reorder quantity.

5 jobs are to be processed on machines M1 and M2 , first on M1 and thenon M2. The processing times in hours are as follows.Find the sequencefor 5 jobs that will minimize total elapsed time .also find idle time& total elapsed time. Job Processing time [ hours ] Machine M1Machine M2 1 5 2 2 1 6 8 9 7 6 3 8 5 10 4

  • 2-4-3-5-1
  • 2-4-3-5-1
  • 1-2-4-5-3
  • Minimum time 28 hours
  • Idle time = 1 & 2 Hours for M1 & M2 respectively

Production Planning and Control makes the supervisor ineffective.

  • True
  • False

The LOB technique is most appropriate for assembly operations involving number of distinct components.

  • True
  • False

The 'G' group of GOLF analysis covers items procurement from Government suppliers such as :-

  • STC
  • STC
  • MMTC
  • Private Sector Undertaking
  • Public Sector Undertaking

In an organization, poor material handling system may result in the following :-

  • Damage to material/product
  • Damage to material/product
  • Delays in transport arrival
  • Delays in supply of material
  • Accidents while handling

What is EOQ?

  • Economics Order Quality
  • Economics Output Order
  • Economics Order Quantity
  • Ergonomics Order Quantity

The make-or-buy decision becomes necessary when the current source ofsupply is not able to supply the material in accordance with buyer'squality requirements.

  • True
  • False

Just-in-time distribution systems are also known as:

  • First in first out
  • Stockless distribution system
  • Specialty carts
  • Centralized exchange systems

The assembly work content [ Wi ] of the i'th station having n work stations is given by :- Correct Answer

  • A Wi from i=1 to n
  • Wi / n

Which of the following is not an assumption for the EOQ model?

  • Only one product is involved
  • Annual demand requirement may be unknown
  • Demand is spread evenly throughout the year
  • Lead time is always constant

To solve "n jobs - 3 machines" sequencing problem, the largest of timeof any job on the second machine must be smaller than or equal to thesmallest time of any job on first machine or third machine.

  • True
  • False

Among different types of costs associated with inventory, the costs of obtaining purchase approvals are ________.

  • purchasing costs
  • ordering costs
  • stockout costs
  • carrying costs

Development of additional vendors/suppliers depends upon :-

  • Marketing forecast
  • Sales forecast

When shop floor scheduling problem larger than 3 machines arise theanalytical solution procedures leading to optimality are complex anddifficult.

  • True
  • False

The batch production requires ________ capital investment as compared to job production.

  • Low
  • High

Material control function embraces a following techniques :-

  • Make -or -buy decision
  • Make -or -buy decision
  • Pareto's analysis
  • Replenishment system

What factors affect the status of PPC department in the company for achieving informal status?

  • Manufacturing Process
  • Manufacturing Process
  • Work is highly repetitive
  • Number of workmen is very large
  • Number of workmen is not very large

If set up time for four operations involved is 2 ,1.5, 2 , 2.5 hours respectively, total set up time would be 10 hours.

  • True
  • False

________items should be excluded from ABC Analysis.

  • Seasonal
  • Non-moving

In assignment matrix, it is a must to determine Jacobean of the determinant.

  • True
  • False

The ideal order quantity a company should purchase for its inventory given a cost set of production, demand rate, and other variables is known as:

  • Reorder point
  • Economic order quantity
  • Anticipation stock
  • Inventory control

As per a study on materials management practices, a typical firm spendsalmost half of its rupee sales on goods purchased from vendors.

  • True
  • False

Which area is the first to accept the responsibility for all supplies in the facility

  • Receiving
  • Requisitioning
  • Distribution
  • Sterile storage

A company where different personnel give conflicting delivery promises need to improve its scheduling and processing function.

  • True
  • False

Computerisation of line balancing involve following requirements :-

  • Operating system
  • System software
  • Application software
  • User friendly interface

Proper Production Planning and Control can reduce cost in :-

  • Overtime cost
  • Procurement cost

They are type of analytical estimate :-

  • Moving average
  • Moving average
  • Exponential smothering
  • Curve fitting

The maximum order level is:

  • The amount of inventory that the business should not fall below
  • The amount of inventory that the business should not rise above
  • The time that it will take for the stock to be delivered to the business
  • The maximum amount of stock that the customer is allowed to order

In linear programming method of line balancing, there are three types of constraints namely :-

  • Cycle time constraint
  • Cycle time constraint
  • Step or task constraint
  • Precedence constraints

Rational figure on utilization index can be obtained by carrying out ________ study.

  • Work sampling
  • Production

The LOB technique is made more accurate and fast by using ________.

  • Log-tables
  • Computers

Work sampling is ________

  • Done continuously without interval
  • Done at random interval

Demand distribution systems are :

  • Predeterminized
  • Computerized
  • Labor intensive
  • Centralized

Due to the following emergent events, the queue time has to compensatefor the time for which the job has to undergo an extra time :-

  • Change in requirement
  • Tool breakage
  • Job split up
  • Change in priorities

At any level of inventory, the total ordering cost and and total carrying cost are always equal.

  • TRUE

Which of the following is not a necessary requirement of a requisition

  • It must be legible
  • It must have the facilitys phone number
  • It must specify the quantity needed
  • It must specify where items are to be delivered

There are five manufacturing systems. However, many manufacturers combines two or more systems to produce a final product.

  • True
  • False

If actual demand far exceeds forecast, it will result into :-

  • Better utilization of equipment
  • Better utilization of equipment
  • Increase in labour productivity
  • Project margin
  • Higher material purchase

Activity R can not start unless activities P & Q are completed .And activity S can not start unless activity Q is over [ I.e. activityP may not be even over ]. Activity R is therefore succedding toactivity P & Q while activity S is succeeding to activity :-

  • P
  • Q
  • R
  • S

Standard time accounts for :-

  • Contingency allowance
  • Contingency allowance
  • Job splitting time
  • Operator's rating/efficiency
  • Tool change time

Total lead time is the summation of following factors :-

  • Queue and transit time
  • Queue and transit time
  • Delay time
  • Manufacturing time
  • Order preparation time

Curve fitting method of statistical forecasting uses curve line approach.

  • True
  • False

The inventory of medical and surgical supplies can represent up to what percentage of a facility's operating budget?

  • 20%
  • 30%
  • 40%
  • 50%

Important considerations in scheduling are :-

  • Degree of centralization
  • Degree of centralization
  • Sales forecast
  • Relative job priority
  • Load chart

Overlapping of operations helps in compressing manufacturing time.

  • True
  • False

LOB technique was devised by US army in the year :-

  • 1951
  • 1952
  • 1955
  • 1958

Classification of items on basis of their capital lock up is called ________ analysis.

  • VED
  • XYZ
  • ABC
  • HML

Production output in night shift is :-

  • More than I shift production
  • Less than I shift production

While communicating to customer on delays in delivery following information should be given :-

  • Information on identification of job
  • Information on identification of job
  • Derailed production records
  • Reasons for delays
  • Revised date of delivery

To solve "n jobs - 2 machines" sequencing problem, it is assumed thateach machine can perform only one type of operation and can undertakeonly one job at a time.

  • True
  • False

The commonly used network techniques other than PERT and CPM are as follows :-

  • MOSS [ Multi Operation Scheduling System ]
  • MOSS [ Multi Operation Scheduling System ]
  • PCS [ Project Control System ]
  • GERT [ Graphical Evaluation Review Techniques ]

Heuristics approach gave very good results when Wester and Kilbridge applied it to ________ assembly line.

  • TV
  • Car

If the annual usage of a material is 1200 units and the reorder point is at 120 Units, find the lead time.

  • 1 month
  • 2 months
  • 3 months
  • 4 months
  • 5 months


  • Predictable yield
  • expressed in ounces
  • to produce a quantity
  • establish consistency

Labour efficiency depends upon ________

  • Training
  • Experience
  • Split up
  • Training and experience

Under economic-order-quantity decision model, it is assumed that ________.

  • the quantity ordered can vary at each reorder point
  • demand, ordering costs, and carrying costs are uncertain
  • the purchasing cost per unit is affected by the order quantity
  • no inventory stockouts occur

Fluctuation due to changes in season are called cyclical fluctuation.

  • True
  • False

Keeping procurement cost and carrying cost constant, if annual usage of certain product becomes 4 times, the EOQ would be :-

  • Doubled
  • Halved

What is the shape of the inventory usage when all EOQ assumptions are met?

  • [No Answer]

Random fluctuation is considered for deciding ________.

  • Seasonal fluctuation
  • Analytical estimate

A firm has 6 jobs to be processed on three machines A,B and C in theorder ABC. The processing time of each job is given in the tablebelow:- Find the idle time on different machines . Job Processing time[ hours ] Machine A Machine B Machine C J1 25 16 20 J2 26 20 19 J3 2417 18 J4 22 20 21 J5 24 21 17 J6 28 18 13

  • 74 , 31 , 58
  • 31 , 58 , 60

Ordering of raw material is based on :-

  • Marketing forecast
  • Sales forecast

The earliest start time of an activity equals to earliest event time of :-

  • Head event
  • Tail event

The main characteristics of mass and flow production are :-

  • Continuous flow of material
  • Continuous flow of material
  • High skilled labour
  • Low skilled labour
  • Easy supervision

Responsibility of smooth flow of work through different work centers or departments of company rests with :-

  • Material department
  • Production control department

Line staff can assist PPC by manufacturing some of their needs in theirown shops rather than making PPC to tool room or purchase.

  • True
  • False

Time study is useful method of measurement for :-

  • Long cycle time operations
  • Short cycle time operations

________ analysis mainly helps to identify non-existing items for whichstore keeps bin cards, wastes computer memory or wastes computerstationary while preparing stores ledger.

  • MNG Analysis
  • SOS Analysis

The ROI of the company can be increased by :-

  • Increasing investment/sales ratio
  • Increasing profit & decreasing inventory

The overall objective of inventory management is to achieve satisfactory levels of customer service while keeping inventory costs reasonable.

  • True
  • False

Ordering the optimum quantity of an item based on historical data is known as:

  • Reorder point
  • Minimum stock quantity
  • Maximum stock quantity
  • Economical order quantity

Inventory management technique for determining an item’s optimal order size, which is the size that minimizes the total of its order costs and carrying costs.

  • economic order quantity model
  • two-bin method
  • ABC inventory system
  • minimization method

Mass & flow production and process production are categorized under :-

  • Continuous production
  • Random production

An ongoing inventory management system is known as a:

  • Perpetual inventory system
  • Manual inventory system
  • Total inventory system
  • Computerized inventory system

Detachable Card contain following information :-

  • Quantity produced
  • Quantity produced
  • Operation
  • Date of production
  • Date of completion

Which distribution system requires the using department to be responsible for maintaining inventory levels?

  • Fixed inventory levels
  • Centralized exchange systems
  • Demand distribution
  • Total inventory control

Process plan is the process of establishing the ________ and mosteconomical path that each part is to follow from raw material stage tofinished product stage.

  • Optimum
  • Shortest

Price orientation

  • HML Analysis
  • SDE Analysis
  • ABC analysis
  • XYZ analysis
  • VED Analysis

________ are grouped so that their total time is preferably equal to or little lesser than the time available each work station.

  • Tasks
  • Assembly lines

Weaknesses of PPC department can be studied on following grounds :-

  • Addition of orders
  • Failures in delivery commitment
  • Cancellation of orders
  • Complaints from customers

Bar-coding of an instrument sets and integral part of:

  • Case carts systems
  • Exchange cart systems
  • Tracking systems
  • Just-in-time systems

Long termed forecasts are for the period of :-

  • One year
  • Two year
  • 3 to 5 years
  • 5 to 10 years

Total inventory cost =

  • carrying cost
  • ordering cost
  • carrying cost + ordering cost
  • carrying cost - ordering cost

Find EOQ in Rs from the following data :-Annual consumption = 20, 000units, Ordering and receiving cost of material = Rs 20 per order,Annual carrying cost or storage cost = 10% of unit cost of material,Cost of material = Rs 50.

  • 10000
  • 20000

A simple but labor intensive system is the:

  • Par-level
  • Exchange-cart
  • Just in time
  • Demand



Keeping available time per day constant, if the desired production rateper day is to be doubled ,cycle time will be reduced by :-

  • 0.2
  • 0.75
  • 0.5
  • 1.0

Sequencing helps management to determine the most economical job sequence the one that consumes minimum :-

  • Elapsed time
  • Lead time

In a mass production assembly shop following work measurement techniques are used :-

  • Time study
  • Time study
  • Work measurement study
  • Work sampling
  • Production study

Inspection operations is a part of process plan for a part.

  • True
  • False

The following are salient features of the fixed order quantity system :-

  • Reorder quantity is always the same which is usually economic order quantity
  • Reorder quantity is always the same which is usually economic order quantity
  • The time interval between deliveries varies.
  • Replenishment action is initiated when the stock on hand is just sufficient to meet demand during the lead time.

Given the following data :- procurement cost per order = Rs 30 ;frequency of ordering per year =4 ; number of suppliers = 3 . Form theabove data, total procurement cost would be Rs ________.

  • 40
  • 360
  • 320
  • 300

PERT is suitable in defense projects and R&D where activity times can not be really predicted.

  • True
  • False

Which of the following is not considered a specialty cart?

  • Disaster
  • Exchange
  • Dialysis
  • Code

Being capable to adjust their production facilities shortly just afterchange in demand for products and without incurring heavy expenses,greater flexibility in production is provided by ________.

  • Continuous production
  • Job & batch production

The data in respect of spindle nose pertains to :-

  • Tooling
  • Raw material data

Which of the following formula is used to compute the annual carrying cost?

  • EOQ * holding cost
  • Average Inventory * carrying cost
  • Annual demand * holding cost
  • Annual demand * ordering cost

Purchase department must keep PPC informed regarding lead time of different items specially where lead times are extended.

  • True
  • False


  • quantity x yield percentage (number of portion)

Stores issue order for an item is prepared as soon as the route sheet is ready.

  • True
  • False

Job production requires ________ capital investment.

  • Low
  • High
  • Lowest
  • Highest

Which type of inventory distribution system requires the use of a predetermined inventory list?

  • Demand
  • Par level
  • Exchange cart
  • Just-in-time

The administrative lead time e.g. time involved in processing theorder, which may be in periodical review system including the perioduntil next review is called ________ lead time.

  • Internal
  • Cumulative

Identify the costs and risks of OVERstocking:

  • Customers will not be able to buy what they want
  • Staff will be made redundant
  • Higher storage costs
  • Items could deteriorate with age

To keep facilities busy, waiting time due to non-availability of work should be kept at :-

  • Maximum
  • Minimum

Methods for recording actual progress of work for shop orders are :-

  • Progress card
  • Progress card
  • Display board
  • Load chart
  • Network updating

The expected time can be minimised by minimising following parameters :-

  • Optimistic time
  • Optimistic time
  • Lead time
  • Pessimistic time
  • Most likely time

One of the causes of inability to meet delivery date originally promised :-

  • Lack of availability of material in time
  • Lack of availability of supervisor in time
  • Lack of staff in shift
  • Load balancing not done properly

Because of uncertainty of activity timings, PERT acquired a shape of ________ model.

  • Probabilistic
  • Realistic

If number of work stations is 8 and work content of all stations is 32 , the cycle time would be ________.

  • 1
  • 2
  • 4
  • 6
  • 8

How much Portion of a given menu item

  • 3
  • 10
  • 4
  • 7

The purchase-order lead time is the ________.

  • time between placing an order and its delivery
  • time between receiving a customer order and producing the products
  • time between receiving a customer order and delivering the items
  • time required to correct errors in the defective products


  • yield percentages and weight to volume
  • yields are not as accurate as in house calculation
  • yields do not take into consideration standard purchase specifications

Par levels should be based on:

  • Actual use
  • Weekly average
  • Monthly average
  • Budget

Lead time is ________ for different items.

  • Same
  • Different

Labour efficiency factor is applied after capacity requirement of equipment is calculated.

  • True
  • False