| Question | Answer |
| What do we call retail chains that are large enough to buy directly from manufacturers?
- Major players
- Final destinations
- National accounts
- Direct Buyers
- Big Boxes | National accounts |
| Which of the following is NOT one of the processes that must be managed in the SCOR model?
- Source
- Make
- Assess
- Deliver
- Plan | Assess |
| Which of the seven “rights” of purchasing is the most important?
- The right time
- The right material
- The right price
- The right supplier
- The right place | The right supplier |
| Your goal as a purchasing professional should always be to get the lowest possible price.
- True
- False | False |
| What is the total cost of buying, using, and disposing of an item called?
- Total price calculation
- Target cost of purchasing
- Maximum cost of usage
- Final cost of buying
- Total cost of ownership | Total cost of ownership |
| Purchasing has always been considered a strategic, value-added function.
- True
- False | False |
| Which of the following is/are true about the “Clerical Era?”
- Purchasing personnel “placed and chased” orders
- Purchasing was the place to move up in the organization
- Purchasing was considered to be a competitive weapon
- All of the above | Purchasing personnel “placed and chased” orders |
| During WWII, which of the following led to an increased emphasis on purchasing’s value-added contribution?
- Improved university training standards
- The emergence of lean thinking
- Material shortages
- Weapons systems design | Material shortages |
| Storytelling--i.e., the ability to demonstrate the value purchasing brings to the table--is an important skill for you to develop in order to advance your career.
- True
- False | True |
| Which of the following is true for a typical manufacturer
- Purchased inputs are about 20-30% of COGS
- Purchased inputs are about 80-95% of COGS
- Purchased inputs are about 10% of COGS
- Purchased inputs are about 60-80% of COGS | - Purchased inputs are about 60-80% of COGS |
| Purchased goods and services are typically a firm’s largest cost category.
- True
- False | True |
| Example(s) of purchased materials that directly affect the customer experience is/are:
- Car-seat material
- Blister packaging for electronics
- The plastic bag holding the cereal inside the box
- All of the above | Car-seat material |
| A dollar saved in purchasing nearly always has a greater impact on profit than an additional dollar of sales revenue.
- True
- False | True |
| If costs are 80% of sales (and profit is 20%), what is the amount of extra sales needed to equal $1,500 in purchasing cost savings?
- $300
- $1,200
- $1,875
- $7,500
- $9,375 | $7,500 |
| When someone says that every dollar saved in purchasing goes straight to the bottom line, which of the following are they referring to?
- Operating profit
- The balance sheet
- Net profit
- Gross profit
- Current assets | Operating profit |
| Reductions in purchasing costs tend to reduce which of the following?
- Profit
- Cost of goods sold
- Liabilities
- Shareholder’s equity
- Debt | Cost of goods sold |
