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LM - 07 Quiz 1

The document is a quiz covering topics related to procurement and outsourcing. It contains multiple choice, enumeration, and problem solving questions. The problem solving question asks students to calculate the breakeven point to determine if a company should outsource or purchase equipment to produce product components based on costs.

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matubaranjohnadrian
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381 views2 pages

LM - 07 Quiz 1

The document is a quiz covering topics related to procurement and outsourcing. It contains multiple choice, enumeration, and problem solving questions. The problem solving question asks students to calculate the breakeven point to determine if a company should outsource or purchase equipment to produce product components based on costs.

Uploaded by

matubaranjohnadrian
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PDF, TXT or read online on Scribd
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BM1913

Matubaran, John Adrian N. BSBA – 2A 03 – 31 – 2024

I. MULTIPLE CHOICE (5 items x 2 points)

Encircle the letter of the correct answer.


1. This economic decision refers to the process of managing a broad range of
procedures associated with a firm’s need to acquire goods and services.
A. Procurement C.
Outsourcing
B. Strategic D.
sourcing Purchasing
2. This involves hiring a third-party external service provider to perform a business
function.
A. Procurement C.
Outsourcing
B. Strategic D.
sourcing Purchasing
3. This benefit of outsourcing helps the business to concentrate on its core functions.
A. Cost savings C. Reduced capital
expenditures
B. Focus D. Increased flexibility
4. This supply chain strategy is used to develop the ability to take a function of a supplier
or a distributor.
A. Near Sourcing C. Virtual Companies
B. Joint Ventures D. Vertical Integration
5. It is the third step in the procurement process.
A. Identify and review requirements C. Determine the right price
B. Identify and select suppliers D. Establish specifications

II. ENUMERATION (5 items x 2 points)


Identify the factors that must be considered in vendor evaluation, in any order.
1. Technical ability
2. Manufacturing capability
3. Reliability
4. After sales service
5. Location
III. PROBLEM SOLVING (1 item x 10 points):
Creative Crafts Inc. distributes abaca bags in selected provinces. The company has
identified that they have a daily demand of 50,000 units for their bags. Relevant to this,
Creative Crafts management is contemplating whether to purchase an equipment worth
P1,000,000 and produce the components of their bags for P40 each or simply have their
trusted supplier produce and ship the components of their bags for P80 each. Compute
for the breakeven point of abaca bags and recommend whether the company should
purchase a new equipment or simply outsource their production.

P1,000,000 + P40 = 80Q

P1,000,000 = P40 - 80Q

P1,000,000 = P40Q

P1,000,000 / P40Q

25,000 = Quantity

As the break-even point Is 25, 000 units, it is better for creative crafts Inc. to outsource the
production of ABACA since the demand is less than 50, 000 units.

Rubric for computation:


CRITERIA POINTS
Complete solution with correct answer 5
Last two (2) major steps of the solution are 4
incorrect
Half of the solution is correct 3
First two (2) major steps of the solution are 2
correct
First major step of the solution is correct 1
Rubric for the recommendation:
CRITERIA PERFORMANCE INDICATORS POINTS
Content Provided pieces of evidence, supporting
details, and factual scenarios
Grammar Used correct grammar, punctuation, spelling,
and capitalization
Organization Expressed the points in clear and logical
of ideas arrangement of ideas in the paragraph
TOTAL

07 Quiz 1 *Property of STI


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