SCM379 Final

Integrated Carriers (Truck-air), such as UPS and Federal Express, are able to capture a larger market share because:

utilize their own aircraft, have extensive ground networks and accurate, real time logistics tracking systems.

Portfolio analysis is:

the categorization of spend map based on the risks to acquire in the marketplace and value

3PLS are carriers that always own assets and act as intermediares between trading partners, for example, shippers and carriers:

False

Accpeting a price discount for ordering larger quantities leads to lower levels of anticipation inventory

False

As escalotor clause provides for an increase, but not a decrease, in a price if costs change

False

FinTech Firms assist manufactures in the development and implementation of processes technologly innovation

False

In portfolio analysis, bottleneck items are characterized by high risk and high value

False

Indirect Costs can be specifically and accuratley assigned to a given unit of production or identifiable task perfromed by a service provided:

False

Marine transport is best suited for products of high value and/or extreamly persishable

False

Online Reverse Acutions are useful means of price determination for customized items

False

Qualifiying soruces is an expample of post-transaction cost phase in the total cost of ownership mdoel

False

Truckload shipments are typically for short haul distances compared to less than truckload shipments

False

Value engineering and value analysis use the same methods, but VA is perferormed in the design stage and VE is performed in the redesign stage

False

If the delivery date is some months or years away and if there is substanital chance of price escalation, a supplier may feel that there is far too much risk of loss to agree to sell under a:

Firm-Fixed Price

Compared to other modes of transportation, motor carriers provide the advantage of:

Flexibility of point-to-point services

When cost analysis is applied to a suppliers price, the buyer:

Identifies and analzies each cost element for cost reduction opportunities

Cost incurred in the operation of a production plant or process, but normally cannot be related directly to any given unit of production or service provided are called:

Indirect costs

Compared to motor carriers, rail:

Is relativley inflexible and slow, and has higher damage rates.

A straight bill of lading:

Is used when teh goods have been paid for in advance of the shipment and requires delivery.

Items for which prices are comparativly low and the cost of price reduction efforts may exceed any price savings are realized are:

Maintence, repair, and operating supplies.

Life cycle costing:

May include costs that are 10-15 years in the future and highly uncertian

Demurrage Charges:

May indicate poor delivery scheduling on the part of the buying organization.

A prucahsing approch to minimize the acquisition costs and rely on competetion to keep prices low is best suited for:

Noncritical/rountine items

The lowest bid may not recive the order if:

The buyer discovers the lowest bidder is unreliable, the lowest bid is higher than the buyer belives is justifiable, and there is reason to believe the bidders colluded.

With the deregulation of the transportation industry and the development of intermodal service, the focus for the transport buyer is:

The carriers ability to handle multiple parts of the logistics process.

A cash discount allows:

The seller to secure prompt payment and the buyer to pay a lower price per unit

Target costing starts with:

The selling price of an organization end product minus the operating profit to establish the target costs

Organizations operating under a just-in-time system prefer to ship by:

Truck

Although associtaed with a number of factors, the learning curve normally is most cloesly identified with the analysis of direct labor costs

True

In portfolio analysis, strategic goods and services are both more valuable to the buying organization and risk acquirer

True

Life cycle Costing can be used to justify the acquisition of expensive equipment on the basis of lower operating costs over the life of the asset

True

Logisitics is the management of inventory in motion and at rest

True

Logistics costs can be divided into 3 categories: inventory carrying costs, administrative costs, and transportation.

True

Target costing may result in company-wide cost reductions in design to cost manufcature to cost, and purchase to cost

True

The cost per hundredweight is generally higher for LTL shipments compared to TL shipments

True

Transportation costs increase and distance, quantity, and speed increase:

True

Two effective logisitics cost reduction strategies are partnering agreements with logisitcs services providers and long-term contracts

True

Hedging is a way to:

Try to minimize price and currency exchange rates

The selection of FOB point is important to the purcasher, because it determines:

Who pays the carrier, when legal title to goods being shipped passes to the buyer, who is responsable for preparing and pursuing loss or damage claims and who routes the freight.

A cash discount of 1/15, N/30, is the equivalent of what approximate interest rate

24 percent

The goal of value engineering and value analysis is to:

Perform a function at the same or improved level while reducing cost.

This bond guarantees work will be done according to specications, in the time specidied, and if another supplier does rework or completes the order, purchasing is indemified for these:

Performance Bond

When using competeive bidding to determine prices, the purchaser should ensure that the bidders are:

Qualifed to make the item or service in accordance with the buyers specifications, able to deliver it by the desired date, sufficiently reliable and numerous enough to ensure a turely competetive price.

In portfolio analysis, the goal when purchasing bottleneck items is to:

Reduce or eliminate customization

If identical bids are recieved, the buyer might choose to:

Reject all bids and negotiate with one or more suppliers

A transportation strategy should include consideration of:

Safety on the ground, in the air and on the water, enviornmental factors, such as pollution, consoldiation of freight and alternative transport modes.

Common methods of analyzing total cost ownership includde:

Standard cost models, unique cost models and segregrating costs on the basis of pretransaction, transaction and post-transaction costs

Purchases categorized as leverage items in portfolio analysis have the following characteristics:

Standard specification or commodity-type items

Fuel efficiency and energy consumption considerations:

are a factor in transportation strategy development in many organizations

Cost management tools and techniques that may provide data for negotiations with internal organzaitonal stakeholders and or externally with suppliers include:

Activiy based costing, the learning cost and total cost of ownership

Marine Transportation is:

Best suited for hauling large tonnage over long distances and disadvantaged because of the need for suitable networks, which are dependent on government support.

Transportation rates:

Are established primarly through negotation.

In portfolio analysis, cost analysis can be used in the acquisitions of strategic goods or services to indentify opporuntites to:

Avoid, eliminate, or reduce costs in buyer and supplier cost structures

Decreasing total business logistics costs as a percentage of US GDP may be atrributed to:

Deregulation of the transportation sector, and improved logistics technology systems and e-commerece.

Labor and material costs are typically

Direct Costs

Purcashers can use activity based costing to:

Eliminate the non value adding activities, reduce activity occurances and reduce the cost driver rate

When estimating the cost structure of a manufacutring supplier:

Equipment depreciation is typically the largest cost element in overhead

The fairest possible means of treating all suppliers alike in a competetive bidding situation is to:

Establish a policy of firm bidding

The cost approach to pricing:

means prices are set to over direct costs, contribute to indirect costs, and provide a profit