TEST BANKSourcing and Supply Chain Management 4th editionHandfield, Monczka, Giunipero, and PattersonChapter 2True or False1. Until an organization can streamline the day-to-day purchasing process, it will continually delay implementing other important strategic activities that help the organization become more competitive.a. Trueb. False2. The objectives of a world-class purchasing organization do not need to move far beyond the traditional belief that purchasings primary role is to obtain goods and services in response to internal needs.a. Trueb. False3. If a suppliers components are defective and causing problems for manufacturing, then purchasing must work closely with the supplier to improve its quality.a. Trueb. False4. The right of purchasing to evaluate and select suppliers means that sales representatives are never allowed to talk with non-purchasing personnel.a. Trueb. False5. The authority to review material specifications is within purchasings span of control, although engineering sometimes disputes this right.a. Trueb. False6. All purchasing needs must be forecasted ahead of time.a. Trueb. False7. When creating a forecast for a needed product or service, internal customers may not always be able to express exactly what it is they will need at a single point in time.a. Trueb. False8. For routine, off-the-shelf items, the purchase requisition may contain all the information that purchasing required.a. Trueb. False9. When purchasing works directly with internal customers to anticipate future requirements, such as during new product development, purchasing is being reactive.a. Trueb. False10. Buyers should use competitive bidding when price is a dominant criteria and the required item or service has straightforward material specifications.a. Trueb. False11. The process that buyers use to select suppliers does not vary widely depending on the required item and the relationship that a buyer has with its suppliers.a. Trueb. False12. For standard items, the negotiation process is an efficient method to purchase relatively straightforward requirements.a. Trueb. False13. For complex items or items requiring untested or a new production process, purchasing can include additional information or attachments on its RFQ to assist the supplier, including detailed blueprints, samples, or technical drawings.a. Trueb. False14. Relying on a list of preferred suppliers can increase the time and resources required for evaluating and selecting suppliers.a. Trueb. False15. In drafting a purchase order, purchasing must take great care when wording such an agreement because it is a legally binding document.a. Trueb. False16. Almost all firms establish blanket purchase orders with their suppliers.a. Trueb. False17. It is very important for the buyer to adequately understand existing market conditions prior to signing a fixed-price contract to prevent contingency pricing from adversely affecting the total cost of the purchase over the life of the contract.a. Trueb. False18. Cost-based contracts are generally less favorable to the buyer because the threat of financial risk is transferred from the seller to the buyer.a. Trueb. False19. There is an incentive, at least in the short run, for suppliers to be inefficient in cost-based contracts because they are rewarded with higher prices.a. Trueb. False20. The responsibility for concealed damage is simple and easy to detect.a. Trueb. False21. Material discrepancies usually result from incorrect quantity shipments.a. Trueb. False22. The buyer may assume that the purchasing cycle ends with the receipt of an ordered item or the selection of a supplier.a. Trueb. False23. The way that MRO items are typically dispersed throughout an organization makes monitoring MRO inventory relatively simple.a. Trueb. False24. Purchasing personnel are no longer involved with transportation buying and the management of inbound and outbound material flows as this is now considered to be a logistics management function.a. Trueb. False25. Some purchasing departments spend 80% of their time managing 20% of their total purchase dollars.a. Trueb. False26. The dollar value of the items covered by purchasing cards is relatively high.a. Trueb. False27. The key benefit to online ordering through electronic catalogs is the ability to match pictures of items with their descriptions.a. Trueb. FalseTEST BANKSourcing and Supply Chain Management 4th editionHandfield, Monczka, Giunipero, and PattersonChapter 2True or False1. Until an organization can streamline the day-to-day purchasing process, it will continually delay implementing other important strategic activities that help the organization become more competitive.a. Trueb. False2. The objectives of a world-class purchasing organization do not need to move far beyond the traditional belief that purchasings primary role is to obtain goods and services in response to internal needs.a. Trueb. False3. If a suppliers components are defective and causing problems for manufacturing, then purchasing must work closely with the supplier to improve its quality.a. Trueb. False4. The right of purchasing to evaluate and select suppliers means that sales representatives are never allowed to talk with non-purchasing personnel.a. Trueb. False5. The authority to review material specifications is within purchasings span of control, although engineering sometimes disputes this right.a. Trueb. False6. All purchasing needs must be forecasted ahead of time.a. Trueb. False7. When creating a forecast for a needed product or service, internal customers may not always be able to express exactly what it is they will need at a single point in time.a. Trueb. False8. For routine, off-the-shelf items, the purchase requisition may contain all the information that purchasing required.a. Trueb. False9. When purchasing works directly with internal customers to anticipate future requirements, such as during new product development, purchasing is being reactive.a. Trueb. False10. Buyers should use competitive bidding when price is a dominant criteria and the required item or service has straightforward material specifications.a. Trueb. False11. The process that buyers use to select suppliers does not vary widely depending on the required item and the relationship that a buyer has with its suppliers.a. Trueb. False12. For standard items, the negotiation process is an efficient method to purchase relatively straightforward requirements.a. Trueb. False13. For complex items or items requiring untested or a new production process, purchasing can include additional information or attachments on its RFQ to assist the supplier, including detailed blueprints, samples, or technical drawings.a. Trueb. False14. Relying on a list of preferred suppliers can increase the time and resources required for evaluating and selecting suppliers.a. Trueb. False15. In drafting a purchase order, purchasing must take great care when wording such an agreement because it is a legally binding document.a. Trueb. False16. Almost all firms establish blanket purchase orders with their suppliers.a. Trueb. False17. It is very important for the buyer to adequately understand existing market conditions prior to signing a fixed-price contract to prevent contingency pricing from adversely affecting the total cost of the purchase over the life of the contract.a. Trueb. False18. Cost-based contracts are generally less favorable to the buyer because the threat of financial risk is transferred from the seller to the buyer.a. Trueb. False19. There is an incentive, at least in the short run, for suppliers to be inefficient in cost-based contracts because they are rewarded with higher prices.a. Trueb. False20. The responsibility for concealed damage is simple and easy to detect.a. Trueb. False21. Material discrepancies usually result from incorrect quantity shipments.a. Trueb. False22. The buyer may assume that the purchasing cycle ends with the receipt of an ordered item or the selection of a supplier.a. Trueb. False23. The way that MRO items are typically dispersed throughout an organization makes monitoring MRO inventory relatively simple.a. Trueb. False24. Purchasing personnel are no longer involved with transportation buying and the management of inbound and outbound material flows as this is now considered to be a logistics management function.a. Trueb. False25. Some purchasing departments spend 80% of their time managing 20% of their total purchase dollars.a. Trueb. False26. The dollar value of the items covered by purchasing cards is relatively high.a. Trueb. False27. The key benefit to online ordering through electronic catalogs is the ability to match pictures of items with their descriptions.a. Trueb. False