inventory management

Question 1

inventory

Answer 1

stock of goods used in an organization

Question 2

what kind of inventory does it include?

Answer 2

raw materials, WIPs, component parts, maintenance + repair, finished products, and in-transit inventory

Question 3

what is the goal of inventory analysis?

Answer 3

when to order and how much to order

Question 4

what are the three types of inventory models?

Answer 4

single period, fixed order quantity, and fixed time period model

Question 5

single period model

Answer 5

used to handle the ordering of one time items like perishables and products that have a limited lifetime

Question 6

fixed order quanity

Answer 6

AKA economic order quantity. the amount of inventory is replenished by a fixed quantity. it gets replenished when it hits a certain point.

Question 7

safety stock

Answer 7

the amount of extra inventory to protect itself from selling out

Question 8

fixed order interval model

Answer 8

AKA fixed time period model. orders are placed at fixed time intervals. if demand varies, the order size will vary from cycle to cycle.

Question 9

average inventory

Answer 9

expected amt of inventory over time.

Question 10

inventory turns

Answer 10

number of times inventory is cycled through over time