New Inventory planning and control Interview Preparation Guide Download PDF
In this Inventory planning and control Interview Questions and Answers guide you will learn that Inventory Management and Inventory Control must be designed to meet the dictates of the marketplace and support the company's strategic plan. Learn basic and advance concepts of Inventory planning and control or get preparation of Inventory planning and control Jobs Interview by our Inventory planning and control Interview Questions and Answers Guide.
41 Inventory planning and control Questions and Answers:
Table of Contents:
2 :: Tell me what does EOQ make work for inventory control?
The EOQ works if its four assumptions match the case it is used on. The assumptions are:
☛ Annual demand, carrying costs and ordering costs can be estimated.
☛ Inventory level is divided by 2, no safety stock, goods used uniformly and are gone by next order.
☛ Stock-out, customer responsiveness and other costs not considered.
☛ No quantity discounts.
☛ Annual demand, carrying costs and ordering costs can be estimated.
☛ Inventory level is divided by 2, no safety stock, goods used uniformly and are gone by next order.
☛ Stock-out, customer responsiveness and other costs not considered.
☛ No quantity discounts.
3 :: Tell me how would you determine the numbers to use in the EOQ formula?
To determine which numbers to use you must look for the following items. The number of items per order is the quantity(Q). The number of items that can be sold is D.
D may be the forecast demand for that particular good. The cost of placing the order is used for S. The final number to find is the carrying cost(C) which is the cost of the item to be held in inventory.
D may be the forecast demand for that particular good. The cost of placing the order is used for S. The final number to find is the carrying cost(C) which is the cost of the item to be held in inventory.
4 :: Tell me about the kinds of reordering systems that can be used in inventory control?
There are several types of reordering systems, in this module we discussed three. The fixed order quantity uses fixed quantities of goods ordered at various order points to replenish inventory. The fixed order period use fixed times of reorder with various order quantities to replenish inventory to preset levels. The final system, just in time uses a constant flow of goods to match the level of demand.
5 :: Tell me what makes a good forecasting model?
A good forecast model will have reasonable costs. the accuracy of its forecasts will allow good decision making. The model will have ample data available for its use and a relevant time span. The model finally will have a low interference level.
6 :: Why do you need to recompute stocking costs for the EOQ level?
In order to compare stock costs when using the EOQ model you must compute the costs for both the original level and the EOQ level of order quantities.
7 :: Do you know what do the letters in the EOQ and stocking cost formula stand for?
The letters in the formulas represent the quantity ordered(Q), the carrying cost of a unit(C), the demand for the units(D) and the cost of completing a order(S).
8 :: Tell me about the total stocking cost in inventory?
Total stocking cost is the cost to the store of holding a good in its inventory. The stocking cost consists of the carrying cost times half the quantity in inventory and the order completion cost times demand divided by the quantity. In its mathematical form the cost is represented by TSC=(Q/2)C + (D/Q)S.
9 :: Tell me if you know when should reorders be placed?
Times for reordering goods vary dependent on the control system you use and its lead time. In fixed order quantities reorders should be placed when the safety stock is reached. In fixed period systems the reordering is done at set time periods. In just in time systems reordering is based on matching the demand with supply. For just in time a close watch on inventory levels is needed so that reorders are placed before goods are out of stock.
10 :: Tell me about forecasting in inventory?
Forecasting is the process of estimating the future demand of a product.
11 :: Tell me what is demand in inventory?
Demand is the quantity that customers are willing to buy. Demand can be found through forecasting and is needed to find the EOQ level.
12 :: Tell me how can a computer help in forecasting future demand?
In the market today there are many computer software packages that can compute forecasted demand for goods held in inventory.
13 :: Can you tell me what is lead time in inventory?
Lead time is the period of time from which a order for goods is placed until it is received by the store. Lead time is an important consideration for determining when orders should be placed.
14 :: Tell me what is an order quantity in inventory?
An order quantity is the amount of goods that an order requests be shipped to the store.
15 :: Tell me what is an order point in inventory?
An order point is a point in time at which a order is placed to replenish goods in inventory.
16 :: Tell me about the interference in inventory control?
Interference is a factor in forecasting demand. Interference is made up of all the factors that a forecaster has no control over. Factors that may be considered interference include natural disasters, unusual customer demands or rare events in the business period.
17 :: What would you expect, if inventory controls are followed?
By following your inventory policy you should be able to realize important advantages in inventory control. The first is reduced costs for inventories, along with reduced amounts of inventory. Theft and shrinkage should also be reduced if inventory policy is followed. The final benefit will be increased profits for the store.
18 :: How would forecasting help in controlling inventory?
Through the use of forecasts inventory levels can be set to meet the demands while keeping levels as low as possible.
19 :: Can you tell me what types of forecasting can you do?
There are two types of forecasting qualitative and quantitative. Qualitative uses personal opinions to determine forecasts. Quantitative uses numerical data and statistical modeling to determine forecasts.
20 :: Tell me when should you take a physical inventory?
A inventory should be taken at least once a year. If items are perishable, seasonal or highly demanded a inventory should be taken more often.
21 :: What would happen if there is no savings or the models produce even results?
If there is no savings a error in the calculations may have occurred or the model does not fit your case. For instances were the total stocking costs are even you may use either order quantity.
22 :: Will it effect the EOQ model, If you get a discount?
Yes, a discount will cause the basic EOQ model to fail. To use a discount in determine a EOQ you must use the EOQ model with quantity discounts.
23 :: Do you know what is the formula of EOQ?
The EOQ formula is the square root of 2 times demand times order completion cost divided by carrying cost. The mathematical formula is square root of 2DS/C.
24 :: When does the model work in inventory?
The model only works for those cases that meet its assumptions.
25 :: Do you know the importance of EOQ level?
The EOQ level is the point at which stocking costs are at their lowest point for a given item.
