STOCKS
What are stocks?
Stocks are material possessions that are in the company but have not been used for a given purpose yet.
What is the main role of supplying?
To provide the necessary inputs for the transformation process.
What does the norm of material consumption determine?
The maximum volume of material that can be consumed per unit of output of a determined quality.
What is an acquisition price?
The price for which stocks were actually procured or purchased.
What is the main aim of purchasing activity?
To choose the most suitable suppliers and the most suitable way of acquiring material.
What type of assets are stocks also called?
Current assets/circulating assets.
Which department is responsible for supplying?
The supply department/purchasing department.
In which two types of units can material consumption norms be expressed?
Natural units and value units.
What costs can be included in the acquisition price besides the purchase price of material?
For example, duties, tariffs, insurance and transport fees.
What does random providing mean?
Material is acquired only when there is a need for it, for example according to a customer's order.
Name two functions of stocks in a company.
They ensure a smooth production process and help overcome temporal and spatial mismatches between individual phases of production.
Which two departments does the supply department cooperate with?
The sales department and the marketing department.
A company has planned annual material consumption of 36 500 kg. What is its average daily consumption?
100 kg per day.
A furniture company produces wooden furniture itself. Which valuation method is used for these stocks?
Own costs.
What is Just-in-Time (JIT) providing?
Material does not go into stock but is sent directly to production.
Why does a company try to keep an optimal level of stocks?
To ensure smooth production while keeping procurement and storage costs as low as possible.
What are the three main physical flows in logistics mentioned in the presentation?
Transport, intake and storage of material.
The average daily material consumption is 100 kg and the time norm of inventory is 8 days. Calculate the stock norm.
Stock norm = Time norm of inventory × Average daily consumption
8 × 100 = 800 kg.
A company receives chemicals as a free donation. Which valuation method is used?
Fair value.
Name three criteria a company should consider when selecting a suitable supplier.
For example: material quality, price and acquisition costs, supplier reliability, delivery conditions or payment conditions.
A company buys a large amount of material because the supplier offers a favourable discount. What type of stock is this?
Occasional stock.
A company receives a delivery. The material is transported and stored, while the invoice and delivery note are processed. What two types of flows are involved?
Physical flows and information flows.
A company has planned annual material consumption of 73 000 kg. Its time norm of inventory is 10 days. What is the stock norm?
73,000 ÷ 365 = 200 kg/day
200 × 10 = 2 000 kg.
A company finds a surplus of packages during an inventory check. The packages were not purchased or produced by the company. Which valuation method should be used?
Fair value.
A supplier offers the lowest material price, but has unreliable deliveries and poor payment conditions. Should price be the only criterion when selecting this supplier? Yes or not and why?
No. The company should also consider quality, acquisition costs, reliability, delivery conditions and payment conditions.