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L4M7 Test Braindumps - Best L4M7 Practice

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CIPS Whole Life Asset Management Sample Questions (Q211-Q216):

NEW QUESTION # 211
What is the stock turn for a store holding products to the value of £250,000 with annual sales of these products amounting to £1,000,000?

A. 0
B. 1
C. 0.25
D. 0.4

Answer: B

Explanation:
Calculating Inventory Turnover (Stock Turn)
As with a typical turnover ratio, inventory turnover details how much inventory is sold over a period. To calculate the inventory turnover ratio, cost of goods (COGS) is divided by the average inventory for the same period.1 Cost of Goods Sold ÷ Average Inventory or Sales ÷ Inventory In this exercise, the stock turn equal to sales divided by inventory, or 1,000,000:250,000 = 4.
Reference:
LO 2, AC 2.3

NEW QUESTION # 212
An organisation may incur additional costs in stockout events. Which of the following is an exam-ple of costs of inventory stockouts?

A. The return forgone by investing capital in inventory rather than elsewhere
B. The lost contribution margin on sales forgone as a result of customer dissatisfaction due to unavailability of goods
C. The costs of storage space owned that cannot be used for other profitable purposes when inventories decrease
D. The costs of obsolescence and costs of insurance that change with the quantity of in-ventory held

Answer: B

Explanation:
Stockout is a situation where an inventory item is not available when required. The costs associated with a stockout include the following:
- Lost of production output - there will be no production until the stockout is resolved (new stock is acquired).
For factory operating 24/7 with no spare capacity, this lost output will not be able to be recovered.
- Costs of machine downtime and of overhead spread over a reduced level of output
- Costs of any action required to deal with the stockout...
- Loss of customer goodwill through inability to supply or late delivery
- Loss of sales or new orders
- Loss of market creditability

NEW QUESTION # 213
A food processing manufacturer must be able to trace the ingredients they use and the food manufactured from those ingredients. Which of the following systems provides the opportunity for efficient traceability?

A. Commodity coded ingredients and barcoded finished products
B. Alphanumeric product code for each ingredient and product code for finished products
C. Batch code for each ingredient and electronic product codes for finished products
D. Order numbering for each ingredient, customer purchase order for finished products

Answer: C

NEW QUESTION # 214
What are the contents of master production schedule in MRP system?

A. How many final products will be made and when to make them
B. What components and materials are and when to purchase them
C. The investment required for production
D. The total number of labour required to produce the final product

Answer: A

Explanation:
A master production schedule (MPS) is a plan for individual commodities to be produced in each time period such as production, staffing, inventory, etc.[1] It is usually linked to manufacturing where the plan indicates when and how much of each product will be demanded.[2] This plan quantifies significant processes, parts, and other resources in order to optimize production, to identify bottlenecks, and to anticipate needs and completed goods. Since a MPS drives much factory activity, its accuracy and viability dramatically affect profitability. Typical MPSs are created by software with user tweaking.
Reference:
LO 2, AC 2.3

NEW QUESTION # 215
The minimal total cost is always achieved when there is only one warehouse. Is this statement true?

A. No, more warehouses will reduce the cost of storage
B. Yes, because the operation cost for warehouse reaches minimal level
C. No, fewer warehouse may lead to increasing transport costs
D. Yes, because warehouse overheads are fully utilised

Answer: C

Explanation:
The total cost of storage consists of two different costs:
- The cost of warehouses: each one has a different cost, and each has the cost of stock-holding and stock management included
- The transport costs: the total transport cost reduces as further warehouses mean shorter final delivery to the customers.
Depending on each situation, the optimal number of warehouses varies. Generally, more facilities will increase the cost of warehouses while reduce the transport costs and vice versa.
Reference:
LO 1, AC 1.1

NEW QUESTION # 216
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