EMT Practice Test

1. Question Content...

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Question1: "Open stock plus purchases minus closing stock" is the formula of which of the following?

Question2: Which of the following are examples of subjective methods of forecasting? Select TWO that apply.
* Trend line analysis
* Moving averages
* Market research
* Expert opinion
* Seasonal variations

Question3: An electricity company charges its customers monthly fee for access and a usage fee for consump-tion of electricity. Which pricing structure is the company using?

Question4: The managing director requires action to be taken to improve the organization's profitability and has asked for suggestions to enable this to be achieved. The procurement manager has said that a just-in-time (JIT) system should be introduced. Would such a system improve profitability?

Question5: A construction organization requires specialist equipment for digging deep foundations. Which of the following circumstances would result in the hire of equipment rather than leasing it?

Question6: Is it correct to state that the accuracy of demand forecasts depends on the accuracy of the available information?

Question7: Assuming that all other factors are constant except one, the net present value of a capital expendi-ture increases when...?

Question8: An organisation always obtains negative cash flow regarding removal and disposal of assets. Is this statement true?

Question9: A company does not have enough space to hold inventory to satisfy an external foreign market. Therefore, the board of directors has decided that the company would buy stock in bulk and pay a fee for storage to a third- party warehouse provider local to the foreign market. This would allow the company to focus on other aspects of the business. The stock will be called off as and when required. Which of the following strategies is being pursued by this company?

Question10: XYZ Ltd is a large retailer who offers a range of products with different margins. The warehouse manager suggests that different product groups should have different level of safety stock. The appropriate level of safety stock is typically determined by...?

Question11: Hi-Tech Products Inc. (HTP) has just opened a new state-of-the-art distribution centre. It has invested heavily in new technology that will help manage, store, and identify stock items and their locations quickly and continuously. Its investment uses wireless technology. HTP will be using which of the following?

Question12: What term describes a method used to account for inventory, where the oldest produced items are recorded as sold first?

Question13: Zemora Clothing Inc. receives high-priced garments with devices hidden inside the lining to avoid possible fraudulent removal from the shop. These tags are activated upon arrival at stores, and security alerts are triggered if a garment is removed or taken out of the store without payment. Which of the following order tracking technology is used by this company?

Question14: The term triple bottom line refers to a method for organizations to measure performance in three ways. Which of the following describe the triple bottom line? Select THREE that apply.
* Economic sustainability
* Market sustainability
* Quality sustainability
* Environmental sustainability
* Technological sustainability
* Social sustainability

Question15: Lean principle focuses on eliminating eight types of waste. Waste in Lean manufacturing is defined as...?

Question16: Nuclear Energy Group Limited (NEG) has a number of investment options currently under appraisal. As these are all long-term investments (more than 30 years), NEG is adopting a total cost of ownership approach. It has gathered data on all associated costs over the life of the investment. Which of the following will be regarded as end-of-life costs?

Question17: Which of the following are typical characteristics of 2D barcodes? Select TWO that apply.

Question18: For which of the following is the 'delphi method' used?

Question19: In inventory management, the cost of insurance and taxes are included in which group?

Question20: An organisation may incur additional costs in stockout events. Which of the following is an exam-ple of costs of inventory stockouts?

Question21: Which of the following are advantages of a multi-story warehouse compared to a single-story warehouse?
* Heavier, frequently moved items will always be stored on the upper floor of a multi-story warehouse
* Order tracking technology will be more effective and efficient in a multi-story warehouse
* There are more options for the storage of inventory by volume, weight, and frequency of movement in a multi-story warehouse
* The cost of land is likely to be less for a multi-story warehouse compared to a single-story warehouse for a similar product volume

Question22: A procurement manager has agreed a contract for the acquisition of a piece of capital equipment and has negotiated a staged payment contract of 30% with order, 30% on delivery, and the remaining 40% on acceptance testing. Was this the right thing to do?

Question23: A supplier delivers large quantities of inventory to its customer's store, but only charges for the goods as and when they are used. This can be described as...?

Question24: Multiple approval levels for a small purchase request is an example of which type of waste?

Question25: Which of the following are most likely the benefits of using unit loads? Select TWO that apply.
Increase transport time of each item

Question26: XYZ Ltd is a major distributor of electrical equipment protection products in the United States. XYZ found that there was a lack of communication between the company and its key supplier, leading to the supplier trying to predict distributor needs and distributor attempting to estimate lead times. Essentially, both the supplier and the distributor have different sets of information, spending time and money trying to predict what the other will do. To deal with this problem, XYZ Ltd decides to implement new inventory management method in which the supplier manage the replenishment of items for sale. Both parties are obliged to share information on variations in demand and stock levels for goods used for or sale. Which inventory management method is XYZ Ltd implementing?

Question27: Your company has established the number of new warehouses it requires and the locations it wishes to build them. The next step is to think about the structural design and capacity. There are different factors to consider in getting these things correct. Which of the following factors can influence the design of a new warehouse facility?

Question28: Which of the following would be considered independent demand items of stock for a supplier that is manufacturing laboratory imaging equipment? Select TWO that apply.
* Office consumables for the organization
* Raw materials required for production
* Machinery spares for the production lines
* Completed finished goods
* Energy consumption for the organization

Question29: 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?

Question30: Staff at DIY Products Inc. (DPI) have been experiencing issues with the identification of stock items. The current labeling system is outdated and unreliable. DPI has therefore invested in a machine-readable approach. Each item has a unique number that is attached visibly to the packaging. This number can be deciphered by a scanner to aid identification. This approach is known as which of the following?

Question31: MRP system is the most suitable IT system to manage which type of items?

Question32: Warehouse automation involves the use of technology to perform as many warehousing tasks as possible.
There are several benefits that can be gained by using automation in a warehouse. They are...

Question33: Which of the following are examples of subjective methods of forecasting? SelectTWOthat apply.

Question34: What is meant by the economic life of an asset?

Question35: Which of the following costs can be classified as 'acquisition costs'?
* Invitation to tender and order processing costs
* Invoice processing and supplier selection costs
* Goods inspection and total ownership cost
* Total input costs and invoice processing cost

Question36: RFID uses radio frequencies for the purpose of identification and tracking of assets. Which of the following are disadvantages of using RFID? Select THREE that apply.
* RFID can be too expensive for many applications compared to other tracking and identification methods
* RFID tags have a limited amount of memory and are less effective than other product tracking systems
* It is difficult for an RFID reader to read the information where tags are installed in liquid or metal products
* Interference has been observed to take place in RFID systems when devices such as hand-held, portable, two-way radios are in use
* RFID provides a much less robust type of security compared to other forms of scanning systems
* RFID is a restriction in managing the updates of stocks during the transportation of products

Question37: Which type of codes can a barcode laser scanner (linear scanner) read?

Question38: A major investment bank is planning to purchase a complex banking system that will interface with multiple applications at varying times of the day. Before deploying the system, there are various levels of testing that must be performed through joint testing between the in-house team and off-shore testing consultants. The testing will be performed in a resource-constrained shared environment and managed by the on-shore development team. The costs for testing are generally classified as...?

Question39: A manufacturer aims at increasing the service levels to 99% from 97% through expanding the safety stock.
Safety stock can be used to accommodate which of the following?
1. Variability of stock turn
2. Variability of holding costs
3. Variability of demand
4. Variability of lead time

Question40: Which of the following materials handling equipment can be used in the warehouse? SelectTHREEthat apply.

Question41: The size of order that minimises the total cost of acquiring and holding stock is known as...

Question42: Bulk loose coal that requires massive handling system should be stored in which area?

Question43: Long-term forecasting of demand using a subjective method is based on a...

Question44: Which of the following would be an impact of low stock in the supply chain?
* Warehouse space would all be full with excess stock
* There may be delays and higher costs to fulfill supply
* Stock may not be available at times of high demand
* Lead times would reduce and purchase costs would fall

Question45: When designing the layout of a warehouse or stores area, one of the factors to consider is the width of the aisles between the racking. Which of the following is a main consideration when calculating the aisle width?

Question46: The time period between placing an order and its receipt in stock is known as what?

Question47: Do all types of warehouses require access to daylight to reduce the cost of electricity?

Question48: When accounting for the disposal of fixed assets, the gain or loss on disposal is equal to...?

Question49: Which of the following is a forecasting technique?

Question50: Which of the following is a benefit of bar code scanning systems?

Question51: The size of the order that minimizes the total cost of acquiring and holding stock is known as ...

Question52: Which of the following best describe the function of MRP?

Question53: Which ONE of the following correctly differentiates between obsolescent and redundant stock?

Question54: An organization might find it more beneficial to lease and use an asset over a predetermined period. After this period, the lessee has the right to secure outright ownership of the asset by paying an agreed amount; otherwise, the asset would be repossessed by the lessor. Which of the following is an advantage of leasing?

Question55: Which of the following are advantages for a purchasing organisation when adopting a leasing method of acquiring equipment?
* The initial purchase cost of the equipment is avoided
* The payments can be met from daily trading income
* The buyer can freely switch to newer technology whenever they wish
* The buyer is not responsible for any damage at the end of the contract

Question56: Amanda is the purchasing manager for AB Construction based in France. She is considering purchasing an asset from overseas but knows she must account for fluctuations in exchange rates in the contract. Is Amanda correct?

Question57: Which of the following costs may be considered part of the holding costs of inventory?
* The cost of sales and the cost of ordering of the goods
* The cost of ordering and the cost of pilferage of the goods
* The cost of pilferage and the cost of insurance of the goods
* The cost of insurance and the cost of deterioration of the goods

Question58: A central distribution warehouse receives deliveries from several suppliers of bread and cakes on pallets in large quantities. These deliveries need to be separated into smaller individual consignments for delivery to retail stores operated by the bakery company. The division of the large quantities into smaller consignments is called:

Question59: Which of the following are main objectives of warehouse operations? Select TWO that apply.

Question60: A logistics company has a 2-story warehouse in the suburban area. The goods receiving area and dispatch area are located on the ground floor only. There is a lift connecting the two floors. The daily operations of the warehouse are quite busy. Which of the following would the best arrangement for this warehouse?

Question61: Which of the following is often created by each business and commonly used for the purpose of inventory management?

Question62: Which of the following factors can be considered when selecting the location of a new warehouse facility?
Select THREE that apply.
* Cost of land
* Product pricing
* The nature of the items to be stored
* Access to transport infrastructure
* The reputation of the company
* Profit margin

Question63: Decommissioning, removal and disposal of assets may have impact on the environment. An organisation should have policies and procedures in place to enhance its environmental performance. Which standard family provides the guidance on environmental policies and procedures?

Question64: Which of the following factors should be considered in the choice of a warehouse location?
* The type of barcoding that is used
* The impact of local authority bylaws and regulations
* The number of forklifts to be used
* The nature of the items to be stored

Question65: Which of the following are the key elements of total productive maintenance?
1. Reactive maintenance
2. Quality maintenance
3. Deferred maintenance
4. Autonomous maintenance

Question66: RFID uses radio frequencies for the purpose of identification and tracking of assets. Which of the following are disadvantages of using RFID? SelectTHREEthat apply.

Question67: The width of aisles within a warehouse is determined by...?

Question68: In a manufacturing organization, which of the following explains an 'indirect' stock classification of items?

Question69: PPC Refinery (UK) must close down an out-of-date refinery which has very poor environmental performance.
The refinery is very sophisticated with many technically complicated machineries, lubricants, coolants and other chemical substances. Decommissioning the refinery is highly risky and hazardous. To manage the decommissioning process well, PPC project team must know these machineries and substances in details.
Which document can provide the technical details on the refinery?

Question70: Which of the following is an assumption of economic-order-quantity model?

Question71: Buffer stock is a level of stock which...

Question72: Under a Hire Purchase Agreement, ownership is transferred to the hirer...

Question73: Which of the following statements about radio frequency identification (RFID) is NOT true?

Question74: Which of the following is the most suitable container of fasteners (screws, nails, nuts and bolts,...)?

Question75: Which of the following correctly describes the triple bottom line?

Question76: Which of the following is another name for scheduled (routine) maintenance?

Question77: Which of the following are most likely to be direct benefits of applying RFID technology? Select TWO that apply

Question78: A group of items which are stacked together for more convenient movement is called...?

Question79: Which of the following are likely to be included in a formal business case document for stakeholders to support the purchase of a new piece of specialist equipment?
* The conformance standard that relates to the future operation of the equipment
* The context of proposed purchase in relation to business strategy alignment
* Resource requirements including the managerial and operational team resources
* The planned preventative maintenance plan for the equipment to ensure effectiveness

Question80: A hospital is purchasing a new software product that will advise nurses when to give medications to hospitalised patients. This is a mobile application that will be used on tablets carried by the nurses. The software is being developed and tested by a company that specialises in mobile medical applications. This software will interface with existing hospital software that orders the medications from the pharmacy. Which acceptance test activity will be required to check whether the new software integrates well with current IT system?

Question81: Which of the following lists all components, ingredients, and materials required to produce the final product?

Question82: Practice of unloading goods from inbound delivery vehicles and loading them directly onto out-bound vehicles is known as ...?

Question83: Which of the following code systems is commonly used by governments as a basis for their Cus-toms tariffs and for the collection of international trade statistics?

Question84: A procurement manager (PM) is purchasing a piece of capital equipment that requires toxic chemicals in its operation. The PM has included end-of-life packaging costs in the whole-life costing calculation. Was it appropriate to include this?

Question85: What are the contents of master production schedule in MRP system?

Question86: A meaning of 'decommissioning a piece of equipment' is to...

Question87: A procurement manager has been asked to justify the purchase of a large piece of capital equipment valued at
£500,000 to internal stakeholders. The procurement manager decided to prepare the justification using a comprehensive formal business case due to the value of the purchase. Were they correct in doing this?

Question88: Which of the following are the different types of inventory that a manufacturing company usually has?
1. Work in progress
2. Economic order quantity
3. Raw materials
4. Finished goods

Question89: The minimal total cost is always achieved when there is only one warehouse. Is this statement true?

Question90: A manufacturer has discovered that some of the stock in its storeroom is obsolete and now wishes to take the appropriate action. Should the manufacturer write the stock off?

Question91: A warehouse manager is evaluating the use of Automated Guided Vehicles (AGVs) within a repetitive task environment. After reviewing their use and price, the manager decided to invest in several AGVs. Were they correct in doing this?

Question92: A manufacturing organisation has a large volume of raw material stock now viewed as redundant. Which of the following is the most appropriate process for the organisation?

Question93: Company XYZ is a candy manufacturer. Company XYZ makes a batch of 1,000 Christmas candy canes that are no longer edible after December 31. Company XYZ is able to sell 750 canes of the batch, but the other
250 are sitting in the warehouse. December 31 comes, and these candy canes is no longer sell-able. The batch of 250 candy canes belongs to which type of inventory?

Question94: Which of the following statements holds true about inventory holding costs?

Question95: Which of the following are holding costs of inventory in a warehouse?
* Costs related to the value of the inventory held
* Losses due to product deterioration
* Preliminary costs associated with purchase orders
* Loss of supplier discounts due to reduction in reorder quantities

Question96: A restaurant needs to buy a new freezer. The owner applies total cost of ownership model to calcu-late the life- time cost of the freezer. This equipment has a price tag of $1,000, the supplier can offer freedelivery if the restaurant pays off immediately. Estimated electricity consumption of the freezer is $200 in 5 years. The supplier ascertains that the freezer is very durable, buyer doesn't need to care about maintenance costs.
However, if the restaurant needs better protection from breakdowns, the warranty is free for the first 12 months after the purchase. This warranty package can be extended once for another 24-month period with the cost of $75. After 5 years, the buyer will be able to resell this freezer for $250. What would be the estimated total cost of ownership of this freezer if the restaurant owner buys the extended warranty package?

Question97: Why do you need a life cycle asset management plan?

Question98: A brewery sells its beer in aluminum cans. It recycles the cans by using contractors to collect and mold the used cans. This is an example of...?

Question99: International Standard Book Number (ISBN) is a unique international identification system for each product form or edition of a monographic publication published or produced by a specific publisher. ISBN is an example of...?

Question100: Inventory may be classified into direct and indirect supplies. Which of the following is a characteristic of indirect supplies?

Question101: Stockyards are suitable for specific materials with which of the following characteristics? SelectTWOthat apply.

Question102: The amount of inventory available at the start of an accounting period is known as...?

Question103: Which of the following are warehouse layouts that allow the cross aisle to meet picking aisle at angles different from 90 degrees?
1. 'Fan' shaped layout
2. Herringbone-shaped layout
3. U-shape layout
4. L-shape layout

Question104: Which of the following statements is true of just-in-time (JIT) purchasing?

Question105: A manufacturer has discovered that some of the stock in its storeroom is obsolete, and now wishes to take the appropriate action. Should the manufacturer write the stock off?

Question106: ANTA Logistics is looking for a place to build a new, integrated cold chain facility, "Chill Hub", to its customers. Which of the following need to be considered when selecting the location of the new facility?
Select TWO that apply.

Question107: Which of the following statements represent a definition for 'obsolescence' in inventory management? Select TWO that apply.

Question108: A procurement manager is sourcing some high-value equipment for their organisation. What are the elements comprising whole-life costing that they need to consider?

Question109: Which of the following are essential aspects that are required for the successful implementation of Just-In- Time (JIT)? SelectTWOthat apply.

Question110: Which ONE of the following correctly differentiates between obsolescent and redundant stock?

Question111: 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?

Question112: GAP Ltd is a growing retail business. It spends a lot of money on buying stock for sale. However, the procurement process is still largely manual. This manual process contains a lot of tasks that are repeated for each procurement event and time consuming. The company management team decides to adopt procure-to-pay (P2P) software in order to eliminate duplicate activities and improve process efficiencies. Which type of cost is GAP targeting?

Question113: An organisation might find it more beneficial to lease and use an asset over a predetermined period. After this period, the lessee has the right to secure an outright ownership of the asset by paying an agreed amount; otherwise, the asset would be repossessed by the lessor. Which of the following is an advantage of leasing?

Question114: Which of the following are holding costs? Select THREE that apply.
* Shipping costs
* Marketing fees
* Damaged goods
* Storage space
* Insurance costs
* Legal fees

Question115: Which of the following is another name for scheduled (routine) maintenance?

Question116: In a manufacturing facility, which types of inventory have the lowest value?
1. Finished goods
2. Secondary components
3. Work in progress
4. Raw materials

Question117: A cardiac department within a local hospital carries out a small number of specialist emergency care heart surgeries each year. The devices implanted in the patients can vary significantly depending on the condition of the patient. Therefore, the hospital requires a stock management technique that minimizes the cost of holding several different items of stock, without impacting the critical service levels, and allowing the supplier to retain the title of the stock until the hospital's cardiac team utilizes it. Which of the following stock management techniques would enable the hospital to achieve this?

Question118: What is meant by the term 'obsolete stock'?

Question119: Which of the following would be an impact of low stock in the supply chain?
* Warehouse space would all be full with excess stock
* There may be delays and higher costs to fulfill supply
* Stock may not be available at times of high demand
* Lead times would reduce and purchase costs would fall