APICS CSCP Practice Test - Questions Answers, Page 23

To determine the required production rate, we first need to calculate the total available production time per week and then divide it by the weekly demand.

Calculate the total available production time per day:

Total shift time per day = 9 hours

Breaks: hour lunch + 2 15 minutes coffee breaks = 1 hour

Net production time per day = 9 hours - 1 hour = 8 hours

Convert hours to minutes: 8 hours 60 minutes/hour = 480 minutes

Calculate the total available production time per week:

Total minutes per day = 480 minutes

Number of working days per week = 5 days

Total available production time per week = 480 minutes/day 5 days/week = 2400 minutes/week

Calculate the required cycle time to meet demand:

Weekly demand = 120 units

Required cycle time = Total available production time per week / Weekly demand

Required cycle time = 2400 minutes / 120 units = 20 minutes/unit

Thus, to meet the customer demand, production must occur at the rate of one unit every 20 minutes.

Reference:

Stevenson, W. J. (2021). Operations Management. McGraw-Hill Education.

Heizer, J., Render, B., & Munson, C. (2020). Operations Management: Sustainability and Supply Chain Management. Pearson.

The cash-to-cash cycle time is calculated as the sum of days' sales outstanding (DSO), days' inventory outstanding (DIO), and minus days' payables outstanding (DPO). Using the provided data:

Supply of inventory (DIO) = 53 days

Payables outstanding (DPO) = 25 days

Receivables outstanding (DSO) = 34 days

Cash-to-cash cycle time: Cash-to-cashcycletime=+Cash-to-cashcycletime=DIO+DSODPO Cash-to-cashcycletime=53+3425=62Cash-to-cashcycletime=53+3425=62days

Therefore, the correct answer is C. 62 days.

Reference:

Coyle, J. J., Langley, C. J., Novack, R. A., & Gibson, B. (2016). Supply Chain Management: A Logistics Perspective. Cengage Learning.

Jacobs, F. R., & Chase, R. B. (2020). Operations and Supply Chain Management. McGraw-Hill Education.

Standard costing involves assigning expected costs to products, including materials, labor, and overhead. This method allows companies to set cost standards and then analyze variances between the actual costs and the standard costs. Purchase price variance analysis specifically examines the differences between the actual price paid for materials and the standard price. This variance analysis is crucial for identifying cost-saving opportunities and managing purchasing performance. Other costing methods like average costing, LIFO, and FIFO do not provide the same level of detail for analyzing purchase price variances.

Reference:

Horngren, C. T., Datar, S. M., & Rajan, M. V. (2015). Cost Accounting: A Managerial Emphasis. Pearson.

Blocher, E. J., Stout, D. E., & Cokins, G. (2018). Cost Management: A Strategic Emphasis. McGraw-Hill Education.

Advanced planning and scheduling (APS) systems are designed to optimize production schedules, manage supply chain operations, and balance supply and demand. APS systems use algorithms and data to generate feasible and efficient production plans, considering constraints such as capacity, lead times, and demand variability. By accurately planning inventory needs, APS helps minimize stock-outs and reduces the risk of holding obsolete inventory. While tools like blanket purchase orders, buy-back contracts, and business-to-business integration software have their benefits, APS provides a comprehensive solution for aligning inventory levels with demand forecasts and production schedules.

Reference:

Vollmann, T. E., Berry, W. L., Whybark, D. C., & Jacobs, F. R. (2005). Manufacturing Planning and Control for Supply Chain Management. McGraw-Hill Education.

Stadtler, H., & Kilger, C. (2008). Supply Chain Management and Advanced Planning: Concepts, Models, Software and Case Studies. Springer.

Buyback contracts require suppliers to repurchase unsold inventory from retailers, which necessitates an effective system for handling returns. A well-developed reverse logistics system is critical for managing the return process efficiently. It includes the collection, transportation, inspection, and processing of returned goods. This system ensures that products can be easily returned, reconditioned, resold, or disposed of properly, minimizing costs and maximizing the value recovered from returned goods. Point-of-sale tracking, monitoring revenue, and sales incentives are beneficial but do not address the core requirement of efficiently handling the logistics of returned products under a buyback contract.

Rogers, D. S., & Tibben-Lembke, R. (2001). An Examination of Reverse Logistics Practices. Journal of Business Logistics.

Blanchard, D. (2010). Supply Chain Management Best Practices. John Wiley & Sons.

Global trade management (GTM) is essential for companies exporting products to emerging markets as it enhances compliance, minimizes risks, and connects supply chain activities. GTM involves the use of technology and strategies to manage and optimize international trade processes, including compliance with various regulatory requirements, tariff management, and efficient cross-border logistics. This approach ensures that the company adheres to international trade laws and regulations, reduces the risk of penalties, and streamlines global supply chain operations. Logistics network planning, distribution requirements planning, and supply chain event management are useful, but GTM specifically addresses the complexities of international trade compliance and integration.

Coyle, J. J., Langley, C. J., Novack, R. A., & Gibson, B. J. (2016). Supply Chain Management: A Logistics Perspective. Cengage Learning.

Manuj, I., & Mentzer, J. T. (2008). Global Supply Chain Risk Management. Journal of Business Logistics.

When a company has adequate average available capacity but lacks surge capacity, increasing order-fulfillment lead times can provide the most capacity relief. By extending lead times, the company can spread out orders over a longer period, allowing for better resource allocation and reducing the pressure on production and distribution during peak times. This approach helps manage the flow of orders more effectively without requiring additional capacity or resources. Implementing allocation, increasing prices, or increasing product queue times may have some effects, but they do not directly address the issue of balancing capacity and demand as effectively as adjusting lead times.

Stevenson, W. J. (2018). Operations Management. McGraw-Hill Education.

Heizer, J., Render, B., & Munson, C. (2017). Operations Management: Sustainability and Supply Chain Management. Pearson.

Order fulfillment lead times are a critical metric for measuring supply chain responsiveness. This metric reflects the total time taken from receiving an order to delivering the product to the customer. Shorter lead times indicate a more responsive supply chain that can quickly adapt to changes in demand and deliver products faster. It encompasses various stages of the supply chain, including order processing, manufacturing, and logistics, providing a comprehensive measure of how swiftly the supply chain can respond to customer needs. Percentage of orders delivered on time, retail inventory days of supply, and upside production flexibility are important metrics but do not capture the overall responsiveness of the supply chain as effectively as order fulfillment lead times.

Chopra, S., & Meindl, P. (2016). Supply Chain Management: Strategy, Planning, and Operation. Pearson.

Harrison, A., & Van Hoek, R. (2011). Logistics Management and Strategy: Competing through the Supply Chain. Pearson.

Sales and Operations Planning (S&OP) is a process that aligns the sales, marketing, operations, and finance departments to create a unified plan for meeting customer demand. The key objectives of S&OP are to balance supply and demand, align the company's strategic plans with its operational capabilities, and improve communication across departments. In the given scenario, the marketing department's sales promotion led to an increase in backorders because the purchasing and planning departments were not informed. Implementing an S&OP process would ensure that all departments collaborate and share information regularly, helping to prevent such issues in the future by synchronizing promotional activities with production and inventory planning.

Wallace, T. F., & Stahl, R. A. (2008). Sales & Operations Planning: The How-To Handbook. T. F. Wallace & Co.

Grimson, J. A., & Pyke, D. F. (2007). Sales and Operations Planning: An Exploratory Study and Framework. The International Journal of Logistics Management.