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7

Terms in this set (22)

Supplier rating is best defined as
Report card of suppliers' performance
The request for proposal (RFP)is issued by purchasing for
non-standard products
As per ABC inventory policy, for C Class items:
low inventory holding costs require lower inventory control costs
Businesses keep track of the physical condition of the asset. This helps businesses know about possible machine failure before the failure occurs. This is known as:
predictive maintenance
All of these are true for buying capital goods except:
Capital goods purchase is predominantly done based on a request for quotation (RFQ)
For C class items:
high level of inventory must be maintained
Goods that are issued by the material stores and that are being processed on within the factory are known as:
Work in progress (WIP)
In order for suppliers to take the rating process seriously, the rating must adhere to all these tenets EXCEPT:
The rating calculations should be detailed and complex
As per ABC inventory policy, A Class items represent
items with high value
The material requisition note is used by:
user departments like production planning to indicate the need of products
Buyers negotiate extending the credit period of payment to the suppliers. Such extension helps the business by:
Delaying the timing of cash flow
The routine oil change in a car is a example of
preventive maintenance
Predictive and preventive maintenance are relevant or maintenance repairs and operating supplies (MRO) purchasing because they:
help businesses better plan MRO item purchase
Some items are used to support the manufacturing process, and they are consumed during the manufacturing process, but are not a part of the finished products. These products are called as:
Maintenance, Repair and Operating supplies (MRO)
Which of these statements is true regarding the maintenance repair and operating supplies (MRO):
The demand of MRO can be sporadic and highly variable
Businesses keep track of the physical condition of the asset. This helps businesses know about possible machine failure before the failure occurs. This is known as
predictive maintenance
As per ABC inventory policy, for A Class items:
high control costs are offset by lower inventory holding costs
All of these are true for capital goods except:
The suppliers are always selected from an approved vendor list
Maintenance, repair and operating supplies (MRO) items:
are not a part of the finished goods
Which of the statements is FALSE for supplier certifications:
Businesses must certify all their suppliers
The metric that measures if all the purchased goods are delivered on time and in full is called:
Perfect order fulfillment
The process of 3-way match is used to ensure that:
The supplier is made the right payment
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