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MAS > 3.8 Inventory > Flashcards

3.8 Inventory Flashcards

1
Q

The Inventory application is used to store information about …

A

all aspects of inventory materials

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2
Q

What information is monitored or tracked in the Inventory application?

List 3 things

A
  • Storeroom balance of inventory items
  • Condition of items and cost of inventory
  • Special order items and stocked item usage
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3
Q

Benefit of tracking balances in Inventory application

A

Balances for an item can be tracked on one page, even if it is in more than one storeroom

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4
Q

How to view picked quantity for an item?

A

Other Balance Summary Information section on Inventory record

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5
Q

What are the prerequisites to view picked quantity for an item?

A

Item must be in a pick list

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6
Q

Where are item pick lists created and managed?

A

Manage Inventory Work Center > Reservations page

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7
Q

How can the requirement for an item be determined?

Method

A

ABC Analysis

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8
Q

Where can ABC analysis be performed?

A

Inventory tab

on Inventory application

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9
Q

At what levels can balances of individual items and tools be checked?

A
  • Bin
  • Lot
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10
Q

For which entity can balances of individual items and tools be checked?

A

Each Storeroom

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11
Q

When does reordering of items occur?

Business need

A

When stock needs to be replenished

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12
Q

In which application(s) can balances be checked?

A

Inventory application

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13
Q

In which application does reordering of items occur?

A

Inventory application

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14
Q

True/False: Vendor information cannot be stored in the Inventory application, only Item Master

A

False: Vendor information can be stored in the Inventory application as well

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15
Q

Benefit of storing vendor information in Inventory

A

Items can be reordered promptly

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16
Q

The Inventory application can be used to specify the … and … where items are …, and view the … ….

A

bins
lots
stored
Storeroom locations

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17
Q

What key elements are specified for an Inventory item, in the Inventory application?

2 things

A

Balances
Costs

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18
Q

The Inventory application can be used to search the database for … … and …

2 things

A

inventory
items
tools

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19
Q

The Inventory application can be used to …, …, and … inventory items by … and … ….

A

issue
transfer
return
site
storeroom location

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20
Q

The Inventory application can be used to specify … … and … information

Reordering related

A

reorder
details
vendor

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21
Q

The Inventory application can be used to … and … … … that are associated with a … …

Rotating items

A

identify
track
rotating
assets
rotating
item

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22
Q

The Inventory application is used to list all … for which an item is listed as a … or … …

A

assets
subassembly
spare
part

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23
Q

The Inventory application is used to specify the … of items that can be … over the … …

A

percentage
received
quantity
ordered

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24
Q

What indicates that items need to be reordered?

A

Storeroom balance indicates that the items must be replenished

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25
Q

What are the reorder details of an item?

A
  • Reorder point
  • Lead time
  • Order unit
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26
Q

What are some examples of vendor information that can be stored in the Inventory application?

Related to a part

A

Manufacturers or models that are associated with each vendor

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27
Q

Define ABC analysis

A

Technique that identifies the items that represent the greatest investment for the company

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28
Q

What does ABC analysis consider?

A

Monetary value and turnover rate

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29
Q

Inventory Costs

Costing methods

List these

A
  • Standard cost
  • Average cost
  • LIFO and FIFO
  • Asset costing
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30
Q

Benefit of specifying average cost

A

Price variations are reflected

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31
Q

What do LIFO and FIFO stand for?

A

Last-in-first-out
First-in-first-out

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32
Q

Benefit of using LIFO/FIFO costing

A

Captures and applies the cost of items on receipt

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33
Q

Restrictions of asset costing method

A

Only available for rotating inventory items

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34
Q

Describe LIFO costing

A

Uses the receipt of items that are the newest in the stock

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35
Q

Describe FIFO costing

A

Uses the receipt cost of items that are oldest in stock

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36
Q

Describe the LIFO costing method in application

Provide example

A

A company that uses the LIFO costing method sells the most expensive (newest) inventory stock first

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37
Q

Benefits of LIFO costing

A

As the profits are decreased, the company benefits from a lower rate of tax

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38
Q

Describe FIFO costing in application

Provide example

A

As the older and cheaper goods are sold, the newer and more expensive goods remain as assets to the company

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39
Q

Benefit of using FIFO costing

A

Prices generally rise overtime because of inflation. As a result the older inventory items in stock can decrease in value - sell first

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40
Q

Describe what issues, transfers, and returns are

Considered as a consolidated group

A

Methods for monitoring and controlling the movement and consumption of inventory items and tools

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41
Q

What type of records in the database generally capture issues, transfers, and returns?

A

Inventory Usage records

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42
Q

How are items issued?

A

Assigned directly to:
- Work Order
- Asset
- Operating location
- GL Account

or

Issued to satisfy reservations

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43
Q

Describe transferring items

A

Items or tools are transferred from one storeroom to another

44
Q

Example of when items are issued to satisfy reservations

A

For use on a work order

45
Q

Charging entity for issuing items - restrictions?

A

Must:
- Belong to the same site, or
- Across sites within an organization

46
Q

Purpose of transferring items

A

Satisfy requirements for the item in the new location

47
Q

Restrictions on moving inventory stock between storerooms in different sites

A

Either:
- Within an organization
- Between separate organizations

48
Q

What defines an item return?

A

Inventory items can be returned to the original storeroom if it was issued or transferred to a new storeroom

49
Q

What are inventory item reservations created for?

Entities

A

Reservations can be created for inventory items and tools

50
Q

Describe inventory replenishment

A

Items are replaced by reserving and reordering the items and tools that are needed

51
Q

Why is inventory replenishment necessary?

A

Organizations must replenish inventory stock to stay functional as items and tools are consumed

52
Q

List types of inventory item reservations

A
  • Hard
  • Soft
  • Backorder
53
Q

Purpose of inventory item reservations

A

Ensure inventory items and tools are replenished in time

54
Q

Inventory Item Reservations

Hard reservations

A

Material requests with a specific time frame

55
Q

What determines whether a hard or soft inventory item reservation is made?

A

Based on the importance of the inventory requirement

56
Q

Which applications enable you to automatically set and process reservation types?

A
  • Purchase Orders
  • Purchase Requisitions
  • Desktop Requisitions
57
Q

Describe how reservations work on a work order

A

In the Reservation Type field, reservations are set in the Planned Material line

58
Q

Describe how reservations work on an internal purchase order

A

The reservation is set in the Reservation Type hidden field when an attendant storeroom is selected on the PO line

59
Q

Inventory Item Reservations

What are the characteristics of a hard reservation?

A

Are prioritized and cannot be superseded

60
Q

What customizations can be made pertaining to hard reservations?

A
  • It can be specified for the reorder process to only include hard reservations
  • It can also be specified that inventory items can only be issued from a storeroom if it has a hard reservation
61
Q

Inventory Item Reservations

Soft Reservations

A

Requests that do not have a specific timeframe

62
Q

Inventory Item Reservations

Purpose of soft reservations

A

Ensure that the item or tool is available for issue at any time

63
Q

Inventory Item Reservations

What does a backorder reservation indicate?

A
  • That an inventory item or tool can only have hard reservations, and
  • The reservation quantity must be satisfied by the available balance on the inventory record
64
Q

Inventory item reservations

What is required to enable usage of the backorder reservation type?

A

Organizations application > disallow negative availability (for that organization)

65
Q

When can inventory items be reordered?

A

Items or tools can be reordered when:
- The storeroom balance indicates that the items must be replenished, or
- If they are listed on approved work orders

66
Q

When can approved work orders be issued (for reordering items)?

A

Within being received into the inventory

67
Q

Where is the Reorder action found?

A

Inventory application > More Actions > Reorder

68
Q

List the options in the Reorder Details tab within the Inventory application

A
  • Safety Stock
  • Lead Time
  • Economic Order Quantity
  • Reorder Point
  • Reorder?
69
Q

Inventory application > Reorder Details tab

Safety Stock

A

The minimum amount of stock that is required for the item

70
Q

Inventory application > Reorder Details tab

Lead Time

A

The number of days it takes from ordering to receiving the item

71
Q

Inventory application > Reorder Details tab

Economic Order Quantity

A

The quantity of items to order which provides the best economic value

72
Q

Inventory application > Reorder Details tab

Reorder Point

A

The balance at which the item is reordered

73
Q

Inventory application > Reorder Details tab

Reorder?

A

Denotes whether the item should be reordered

74
Q

List the options in the Reorder Items dialog

A
  • Ignore Reorder Point?
  • Reorder Direct Issue Items and Services?
  • Consider Contracts When Creating PRs/POs?
  • All Items in Storeroom?
  • Include Soft Reservations?
75
Q

Reorder Items dialog

Ignore Reorder Point

A

Allows the user to reorder the item without validating the items quantity to the reorder point

76
Q

Reorder Items dialog

Reorder Direct Issue Items and Services?

A

Allows the user to reorder direct issue items and services

77
Q

Reorder Items dialog

Consider Contracts When Creating PRs/POs?

A

Allows the user to reorder items and consider contracts

78
Q

Reorder Items dialog

All Items in Storeroom?

A

Indicates whether to reorder all of the items in the selected storeroom

79
Q

Reorder Items dialog

Include Soft Reservations?

A

Indicates whether to include soft reservations when selecting items for reorder

80
Q

Purpose of reorder locks

A

When an item is reordered, a lock is placed on the storeroom being restocked to prevent other users from reordering items for the same storeroom at the same time

81
Q

How to remove reorder locks

A

Select Reorder > Clear Reorder Locks

82
Q

When is current balance adjustment generally done?

A

When a simple error is made in issuing or receiving

83
Q

What accounts are affected by a current balance adjustment?

A

Control GL Account - credited
Shrinkage Cost Account - debited

84
Q

Where are Control GL Account and Shrinkage Cost Account codes obtained?

A

Storeroom configuration specified in the Storerooms application

85
Q

What is the difference between adjusting the current balance and adjusting the physical counts?

A

Accounting-based

Current balance adjustment: correction for an error - the item was not lost in any way

Physical count adjustment: item has been lost and/or has disappeared

86
Q

When are physical counts performed?

A

Generally performed at specified intervals

87
Q

Describe GL Transactions during Physical Counts

A

Use the Storeroom’s Shrinkage Account as both the GL Debit Account and GL Credit Account

88
Q

What is needed for the physical count to become the current balance?

A

Needs to be reconciled

89
Q

What is the restriction on items that can have physical count adjustments?

A

Non-rotating items only

90
Q

What inventory management system do most companies use?

A

Just-in-time inventory management system

91
Q

Purpose of using just-in-time inventory management system

A

Reduce stocking levels and associated carrying costs

92
Q

What are purchasing and stock levels based on, when using a just-in-time system for maintenance?

A

Upcoming work (rather than past usage)

93
Q

What is the advantage (justification) for using the just-in-time inventory management system?

A

Parts and assets can become obsolete and processes can change.

Therefore, looking back may not be as useful as looking forward when considering inventory needs

94
Q

How does Maximo accommodate just-in-time inventory systems?

A

Allows reorder quantities to be set

95
Q

Which Maximo applications be used to determine what items will be needed in the future, and how?

A

Preventive Maintenance
Condition Monitoring

Use these to schedule and plan upcoming maintenance and inspection work

96
Q

What is the Service Items application used for?

A

Insert and maintain services that are requisitioned, either on a frequent or infrequent basis

97
Q

Functionality of Service Items application

List these

A
  • Allows for the creation of service item records
  • View or manage a list of vendor companies that supply the service item
98
Q

What is the Tools application used for?

A

Create and maintain information on the tools used on jobs

99
Q

Where is Tools information referenced?

A

Job Plans and Work Orders

100
Q

What does the Tools application function similarly to?

Application

A

Item Master

101
Q

What is the Stocked Tools application used for?

A

Manage existing tools in storerooms

102
Q

What does the Stocked Tools application function similarly to?

Application

A

Inventory

103
Q

Describe the usefulness of Units of Measure and Conversions

A

If the units of measure do not match when an item is received or transferred into a storeroom, the product looks for a conversion ratio to determine the stocking balance

104
Q

What is associated to an item when it is added to a storeroom?

A

Order unit
Issue unit

105
Q

True/False: Add/Modify Units of Measure is available in the Inventory application only

A

False: Add/Modify Units of Measure can be used in more than 1 application

MAS (50 decks)

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