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One of the following statements about PRS (Periodic Reordering System) is not true identify.
[1998]
- a)PRS provides basis for adjustments to account for variations in demand.
- b)PRS is useful in control of perishable items
- c)PRS requires continuous monitoring of inventory levels
- d)In PRS, inventory holding costs are higher than in Fixed Reorder Quantity System
Correct answer is option 'C'. Can you explain this answer?
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Most Upvoted Answer
One of the following statements about PRS (Periodic Reordering System)...
Statement: PRS requires continuous monitoring of inventory levels
Explanation:
The Periodic Reordering System (PRS) is a method used for inventory management. It involves placing orders for a fixed quantity of items at regular intervals, rather than when the inventory reaches a specific level. In PRS, the inventory is reviewed periodically, and an order is placed to replenish the stock to a predetermined level.
Advantages of PRS:
1. Basis for adjustments: PRS provides a basis for adjustments to account for variations in demand. By reviewing the inventory periodically, the organization can analyze the demand patterns and adjust the order quantity or reorder points accordingly.
2. Control of perishable items: PRS is useful in the control of perishable items. Perishable items have a limited shelf life, and maintaining excessive inventory can lead to spoilage and wastage. PRS helps in ensuring that the inventory levels are controlled and replenished as needed to minimize the risk of perishable items expiring.
3. Cost considerations: PRS takes into account the holding costs associated with inventory. Holding costs include expenses such as storage, insurance, and obsolescence. By ordering fixed quantities at regular intervals, PRS aims to optimize the balance between holding costs and order costs.
Why statement 'C' is not true:
The given statement claims that PRS requires continuous monitoring of inventory levels, which is not true. In PRS, the inventory is reviewed periodically at fixed intervals, rather than continuously monitored. The interval at which the inventory is reviewed depends on various factors such as demand patterns, lead time, and cost considerations. The purpose of PRS is to create a systematic approach to inventory management, reducing the need for constant monitoring and allowing for more efficient ordering and replenishment processes.
Therefore, statement 'C' is not true as PRS does not require continuous monitoring of inventory levels.
Explanation:
The Periodic Reordering System (PRS) is a method used for inventory management. It involves placing orders for a fixed quantity of items at regular intervals, rather than when the inventory reaches a specific level. In PRS, the inventory is reviewed periodically, and an order is placed to replenish the stock to a predetermined level.
Advantages of PRS:
1. Basis for adjustments: PRS provides a basis for adjustments to account for variations in demand. By reviewing the inventory periodically, the organization can analyze the demand patterns and adjust the order quantity or reorder points accordingly.
2. Control of perishable items: PRS is useful in the control of perishable items. Perishable items have a limited shelf life, and maintaining excessive inventory can lead to spoilage and wastage. PRS helps in ensuring that the inventory levels are controlled and replenished as needed to minimize the risk of perishable items expiring.
3. Cost considerations: PRS takes into account the holding costs associated with inventory. Holding costs include expenses such as storage, insurance, and obsolescence. By ordering fixed quantities at regular intervals, PRS aims to optimize the balance between holding costs and order costs.
Why statement 'C' is not true:
The given statement claims that PRS requires continuous monitoring of inventory levels, which is not true. In PRS, the inventory is reviewed periodically at fixed intervals, rather than continuously monitored. The interval at which the inventory is reviewed depends on various factors such as demand patterns, lead time, and cost considerations. The purpose of PRS is to create a systematic approach to inventory management, reducing the need for constant monitoring and allowing for more efficient ordering and replenishment processes.
Therefore, statement 'C' is not true as PRS does not require continuous monitoring of inventory levels.
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Community Answer
One of the following statements about PRS (Periodic Reordering System)...
The correct option is C, PRS requires continuous monitoring of inventory levels
In the periodic reordering system, Inventory level is reviewed after a fixed period of time and fresh order is placed at that time. So, PRS doesn't require continuous monitoring of inventory levels.
In the periodic reordering system, Inventory level is reviewed after a fixed period of time and fresh order is placed at that time. So, PRS doesn't require continuous monitoring of inventory levels.
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One of the following statements about PRS (Periodic Reordering System) is not true identify.[1998]a)PRS provides basis for adjustments to account for variations in demand.b)PRS is useful in control of perishable itemsc)PRS requires continuous monitoring of inventory levelsd)In PRS, inventory holding costs are higher than in Fixed Reorder Quantity SystemCorrect answer is option 'C'. Can you explain this answer?
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One of the following statements about PRS (Periodic Reordering System) is not true identify.[1998]a)PRS provides basis for adjustments to account for variations in demand.b)PRS is useful in control of perishable itemsc)PRS requires continuous monitoring of inventory levelsd)In PRS, inventory holding costs are higher than in Fixed Reorder Quantity SystemCorrect answer is option 'C'. Can you explain this answer? for Mechanical Engineering 2024 is part of Mechanical Engineering preparation. The Question and answers have been prepared according to the Mechanical Engineering exam syllabus. Information about One of the following statements about PRS (Periodic Reordering System) is not true identify.[1998]a)PRS provides basis for adjustments to account for variations in demand.b)PRS is useful in control of perishable itemsc)PRS requires continuous monitoring of inventory levelsd)In PRS, inventory holding costs are higher than in Fixed Reorder Quantity SystemCorrect answer is option 'C'. Can you explain this answer? covers all topics & solutions for Mechanical Engineering 2024 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for One of the following statements about PRS (Periodic Reordering System) is not true identify.[1998]a)PRS provides basis for adjustments to account for variations in demand.b)PRS is useful in control of perishable itemsc)PRS requires continuous monitoring of inventory levelsd)In PRS, inventory holding costs are higher than in Fixed Reorder Quantity SystemCorrect answer is option 'C'. Can you explain this answer?.
One of the following statements about PRS (Periodic Reordering System) is not true identify.[1998]a)PRS provides basis for adjustments to account for variations in demand.b)PRS is useful in control of perishable itemsc)PRS requires continuous monitoring of inventory levelsd)In PRS, inventory holding costs are higher than in Fixed Reorder Quantity SystemCorrect answer is option 'C'. Can you explain this answer? for Mechanical Engineering 2024 is part of Mechanical Engineering preparation. The Question and answers have been prepared according to the Mechanical Engineering exam syllabus. Information about One of the following statements about PRS (Periodic Reordering System) is not true identify.[1998]a)PRS provides basis for adjustments to account for variations in demand.b)PRS is useful in control of perishable itemsc)PRS requires continuous monitoring of inventory levelsd)In PRS, inventory holding costs are higher than in Fixed Reorder Quantity SystemCorrect answer is option 'C'. Can you explain this answer? covers all topics & solutions for Mechanical Engineering 2024 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for One of the following statements about PRS (Periodic Reordering System) is not true identify.[1998]a)PRS provides basis for adjustments to account for variations in demand.b)PRS is useful in control of perishable itemsc)PRS requires continuous monitoring of inventory levelsd)In PRS, inventory holding costs are higher than in Fixed Reorder Quantity SystemCorrect answer is option 'C'. Can you explain this answer?.
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