Question

There will generally be few ___ items and many ___ items.

'B', 'A' 'C', 'A' 'A', 'C' 'C', 'B'

Which of the following best describes ABC analysis?

ABC analysis helps you tailor ordering practices based on relative item values. ABC analysis uses letters instead of numbers or names to identify SKUs. ABC analysis is a one size fits all approach to managing SKUs. ABC analysis requires the use of complex algorithms.

Which of the following might be expected to be an “A” item SKU at a university?

a $30,000 vehicle a computer monitor a particular type of pen a ream of paper

Which of the following statements about ‘A’, ‘B’, and ‘C’ items is correct?

The most valuable items are ‘B’ items. ‘C’ items are tightly monitored. ‘A’ items are generally ordered in small quantities. ‘A’, ‘B’, and ‘C’ items are ordered with the same frequency.

ABC classification is based on which of the following?

units of annual item use item value value of annual item use value of item use relative to total value of items used

Answer 1

Answer 1: Option C

Explanation: In an ABC analysis, there about 20% A items which contribute to 80% of the effect. On the other hand, there are about 60% C items which contribute to 10% of the effect.

Answer 2: Option A

Explanation: ABC analysis uses the items’ relative values in order to tailor the ordering practices. It also groups them in the category of A, B, and C.

Answer 3: Option A

Explanation: A $30,000 vehicle would be categorized as an A item in the ABC analysis. This is because its consumption value is higher while the number of quantity is low and it is tightly monitored.

Answer 4: Option C

Explanation: The consumption value of A category items is higher while the number of quantity is low. They are 20% of the total quantity and produce the effect of about 70% of the total value.

Answer 5: Option D

Explanation: The ABC analysis is based on the relative value of items to the total value of items used.