Logistics management technology
1. What is false regarding customer service? A). There exist different levels of customer service B). A minimum level is required to stay in business C). All customers should be treated equally D). Priorities should be made amongst customers
2. What are the four "legs" of business operations which have undergone deregulation over the past several years? A). Transportation, financial, power, and communication. B) Transportation, financial, power, and technology. C). Financial, power, communication and medical. D) Financial, power, communication and accounting.
3. Which is created when a product or service, is at a point when demanded by customers? a. form utility b. place utility c. time utility d. possession utility
4. Logistics decisions about inventory, transportation, and warehouse should relate to which of the following? a. the globalization of business b. the changing government infrastructure c. structural changes in business d. customer service requirements
5. What is an amalgam of catalogs from vendors available via the Internet within a market called? a. electronic marketplace b. buy-side system c. sell-side system d. on-line trading community
6. The expected costs of stockouts includes all of the following except: A). Back orders B).Lost sales C).Warehouse staff downtime D).Lost customers
7. The global logistics channel intermediary that supervises the movement of goods through customs and ensure that the documentation accompanying a shipment is complete and accurate is: a. a foreign freight forwarder b. an export packer c. a customs house broker d. a foreign trade specialists
8. Sharpe Cutlery, Ltd., is an English Firm that manufactures cutlery. Housewares Imports, Co.,placed an order with Sharpe for 10,000 knife sets. Sharpe shipped the knives to the Port of New Orleans. Housewares Imports will reship the knives to a South American destination and the payment of import duty is deferred. Which type of storage facility should be used? a. transit shed b. in-transit storage c. hold-on-dock storage d. bonded warehouse
9. An inventory decision should consider safety stock when there is a chance of____: a. turnover b. over ordering c. stockout d. oversupply
10. In the simple EOQ model, the reorder point is: A). the maximum amount needed for sales during the time it takes to replenish inventory B). the minimum amount needed for sales during the time it takes to replenish inventory C). the time necessary for a company to process an order D). a concept required to minimize total inventory costs
11. Using the fixed order quantity model under conditions of certainty, which is the reorder point if lead time is a constant 5 days, and yearly demand is 10,000 units (assume 250 working days in the year)? A). 100 B). 200 C). 400 D). 5,000
12. There are three practices that are generally associated with additional approaches to inventory management. Which is not one of these? A). JIT B. DRP c. MRP d. EC
13. Cyrus Production has six production plants, each located within a 45 mile circle Cyrus specializes in small volume custom production of automobile parts. Each plant's daily output is typically small, and in most cases, the outputs do not require any priority shipping arrangements. Shipping each plant's daily output by motor carrier is expensive because the items are shipped by LTL rates. If the outputs were accumulated for a TL shipment it may take as long as two weeks before a shipment can be made. Instead, the shipments are accumulated at Cyrus central warehouse into daily TL shipments. This describes which value-added role of warehousing in a logistics system? A.) smoothing B). contingencies C). decoupling D). transportation consolidation
14. Which type of warehouse stores items for producers that wish to postpone payment of taxes on the items stored? A). field warehouse B). private warehouse C). federal warehouse D). bonded warehouse
15. All are characteristics of a common carrier, except: A serves the general public b. is liable for loss and damage of a shipment c. is not economically regulated d. charges reasonable rates
16. Which determines the claim value of a damaged commodity? a. the amount the claimant requests b. the amount the carrier offers in an attempt to settle c. the market value at the time of the shipment d. the market value at destination
17. Which of the following is NOT one of the steps in the Process Model? A). Decision to form relationship B). Structure operating model C). Evaluate alternatives D). Reduce staff
18. A firm who manages the resources, capabilities, and technology of its own organization with those of complimentary service providers to deliver a comprehensive supply chain solution is called a: A). 3PL B). 4PL C). 2PL D). 1PL.
19. Which is the relationship between carrying cost and the level of inventory? A). they are inversely proportional B).they are directly proportional C). both are unaffected by capacity considerations D).under most circumstances they are unrelated.
20. Which type of stockout costs is the most undesirable to the company? A).cost of back orders B).cost of lost sales C).cost of carrying inventory D).cost of lost customers
1. Nittany Fans of Lewistown, Pennsylvania, is a distributor of industrial fans used in plants warehouses, and other industrial facilities. Its market area encompasses most of Pennsylvania, Eastern Ohio, and New Jersey. The fans are manufactured in Neenah, Wisconsin, and currently shipped to Lewistown via rail transportation. LuAnn Jaworski, vice president of logistics, has asked her staff to evaluate using motor carrier service. Rosi Greaser, director of distribution services, has developed the following information:
Annual demand: 36,000 fans Fan value (price): $4,000
Inventory carrying cost: 25 percent Order cost to replenish inventory: $200
In-transit inventory carrying cost: 15 percent Order cycle time using rail: 4 days
Order cycle time using motor carrier: 2 days Rail rate: $1.00/cwt
Motor rate: $2.4/cwt Unit weight: 250 pounds per fan
Work days of a year: 360 days
Questions
A What is the economic order quantity [EOQ) for Nittany Fans in units? In pounds?
B. What is the total cost using rail transportation?
C. What is the total cost using motor carrier transportation?
D. What alternative should Nittany Fans use?
2. The Lycoming Electric Company is contemplating opening a new generating plant along the Susquehanna River because of increased electric power demand in that region. According to the president and manager of Lycoming Electric, Tract Shannon, "We've had very little problem finding the appropriate location for the plan along the river. However, since we rely on the burning of coal to produce the electricity, and since there is no possibility of using the river flow to generate electricity because of its current and speed, our biggest problem lies in determining which mode of transportation to use in acquiring the needed coal." According to its planning department, Lycoming Electric will need30,000 cwt. (3,000,000 Ibs.) of coal per year in its plant. Skip Grenoble, logistics manager, presented to Ms. Shannon the only feasible systems available to transport such a large amount of coal to the new plant (see exhibit). According to Mr. Grenoble, "The rail system will result in a lower total cost, but the actual transportation costs will be higher than in the barge system because the nature and size of the barge equipment will necessitate our ordering in larger amounts. This, however, will also result in a lower annual ordering cost for the barge system because ordering in larger lots will reduce the amount of necessary orders. Administrative costs for the rail system will be higher due to the addition of an extra manager to handle necessary paperwork and other duties. The fixed cost for the rail system will include a rail siding, unloading equipment, and a conveyor system to get the coal inside the plant. When comparing these two systems to determine which is the most suited to our plant facility and overall efficiency, we must make our decision not on total cost alone but on how each system will contribute to our overall profitability." The relevant cost information is summarized in the table (annual cost in cwt.).
Rail Barge
Transportation costs $ 22,000 $ 14,500
Inventory costs
Carrying 1,346 2,266
Handling 1,760 2,000
Ordering 1,900 1,350
Fixed costs 99,444 116,391
Total costs $128,450 $136,507
Questions
A. If you were the logistics manager of Lycoming Electric, which system would you advise Ms. Shannon to initiate? What criteria did you use to arrive at your decision?
B. At what level of demand in pounds of coal per year would these two systems be equal? (???????????)
3. What is a logistics information system, its purpose, and major components?
4. Describe the function of the following documents: bill of lading, freight bill,certificate of origin, letter of credit, and carnet.