Purchasing Principles Flashcards
6 cards from real APP practice questions. Tap to flip, then mark Knew It or Still Learning — missed cards come back until you master them.
Read the first 6 Purchasing Principles flashcards as text
What is the primary objective of purchasing in a business?
Answer: Obtain goods and services at the best value
The goal of purchasing is to acquire the right quality of goods or services at the right time, in the right quantity, from the right source, at the right price.
Which of the following best defines the term 'lead time'?
Answer: Time between order and delivery
Lead time is the period between placing an order and receiving the goods, and is crucial for maintaining proper inventory levels.
Which department is most likely to work closely with purchasing?
Answer: Production
The production department depends on purchasing to supply the materials needed for manufacturing on time and in the right quantity.
What is 'just-in-time' (JIT) purchasing?
Answer: Receiving goods only as needed
Just-in-time purchasing focuses on receiving goods only when needed, reducing inventory carrying costs and waste.
What is the main advantage of centralized purchasing?
Answer: Better pricing and standardization
Centralized purchasing allows for bulk buying, standardization, and cost efficiency through economies of scale.
What is a purchase requisition?
Answer: Internal request for purchase
A purchase requisition is an internal document requesting the procurement of a good or service, typically sent to the purchasing department.