Inventory & Resource Management Flashcards
7 cards from real CFA practice questions. Tap to flip, then mark Knew It or Still Learning — missed cards come back until you master them.
Read the first 7 Inventory & Resource Management flashcards as text
What is the primary purpose of conducting a physical inventory count in field operations?
Answer: To verify that recorded stock levels match actual on-hand quantities
Physical inventory counts verify that recorded stock levels accurately reflect actual quantities on hand, helping identify and resolve discrepancies.
When a field associate notices that supply levels have dropped below the reorder point, what should be the immediate next step?
Answer: Initiate a replenishment order according to established procurement procedures
When supplies drop below the reorder point, the associate should immediately initiate a replenishment order per established procedures to prevent stockouts.
Which inventory management technique categorizes items by their annual consumption value to prioritize management efforts?
Answer: ABC Analysis
ABC Analysis categorizes inventory into A (high value), B (medium value), and C (low value) groups based on annual consumption value to focus management attention appropriately.
What does FIFO stand for, and how does it apply to managing perishable field supplies?
Answer: First-In, First-Out — oldest stock is used or distributed before newer stock
FIFO (First-In, First-Out) ensures the oldest inventory is consumed first, which is critical for perishable items to minimize waste and expiration losses.
A field associate discovers a discrepancy between the inventory log and actual stock. What is the BEST first action?
Answer: Conduct a recount to confirm the discrepancy, then document and report it
The correct procedure is to recount to confirm the discrepancy, then document findings and report through proper channels to maintain accountability.
What is the purpose of an asset tag on field equipment?
Answer: To uniquely identify and track each piece of equipment in the organization's asset register
Asset tags provide a unique identifier that links physical equipment to its record in the asset register, enabling accurate tracking and lifecycle management.
Which of the following best describes a 'stockout' in the context of field resource management?
Answer: A situation where required supplies or materials are unavailable when needed
A stockout occurs when required supplies or materials are unavailable when needed, which can disrupt field operations and service delivery.