Pharmacy Inventory Management 3 — Questions and Answers
Question 1: A pharmacy's turnover rate for a medication is 12 per year. What does this indicate?
- The drug is reordered 12 times per year
- The entire stock of that drug is sold and replaced approximately once per month (Correct answer)
- The drug expires 12 times per year
- The drug costs $12 per unit
Correct answer: The entire stock of that drug is sold and replaced approximately once per month
A turnover rate of 12 means the inventory for that item is completely sold and restocked about once per month (every 30 days).
Question 2: Which of the following is required when returning Schedule II controlled substances to a DEA-registered reverse distributor?
- DEA Form 41
- DEA Form 106
- DEA Form 222 (Correct answer)
- DEA Form 224
Correct answer: DEA Form 222
DEA Form 222 (or CSOS) is required when transferring Schedule II controlled substances to a reverse distributor for destruction.
Question 3: What is 'shrinkage' in pharmacy inventory management?
- Reduction in tablet size due to manufacturing changes
- Unexplained loss of inventory due to theft, diversion, or error (Correct answer)
- Decrease in drug potency over time
- Reduction in wholesaler pricing
Correct answer: Unexplained loss of inventory due to theft, diversion, or error
Shrinkage refers to unexplained inventory losses that may result from theft, diversion, administrative errors, or damage.
Question 4: A pharmacy wants to reduce carrying costs. Which strategy is MOST effective?
- Increase safety stock for all medications
- Implement just-in-time (JIT) ordering (Correct answer)
- Order in bulk to maximize wholesaler discounts
- Increase the reorder point for all drugs
Correct answer: Implement just-in-time (JIT) ordering
Just-in-time ordering minimizes inventory held on hand, directly reducing storage, insurance, and obsolescence costs.
Question 5: Which form must be completed within 1 business day when a pharmacy discovers a theft or significant loss of Schedule II controlled substances?
- DEA Form 41
- DEA Form 106 (Correct answer)
- DEA Form 222
- DEA Form 363
Correct answer: DEA Form 106
DEA Form 106 must be filed within 1 business day of discovering a theft or significant loss of controlled substances.
Question 6: What is 'dead stock' in a pharmacy?
- Medications stored in a refrigerator
- Inventory that has not moved in an extended period and is unlikely to sell (Correct answer)
- Controlled substances awaiting destruction
- Stock returned by patients
Correct answer: Inventory that has not moved in an extended period and is unlikely to sell
Dead stock refers to inventory that has not been dispensed or sold in a long time and ties up capital without generating revenue.
Question 7: A pharmacy orders 500 units of Drug X per order and places orders 6 times per year. What is the average inventory assuming a zero safety stock?
- 83 units
- 250 units (Correct answer)
- 500 units
- 3,000 units
Correct answer: 250 units
Average inventory = Order quantity / 2, so 500 / 2 = 250 units when safety stock is zero.
Pharmacy Inventory Management 3
A pharmacy's turnover rate for a medication is 12 per year.
What does this indicate?