Test 2: CHAPTER 5, 6

Test 2: CHAPTER 5, 6

Q1: Define "direct materials" and "indirect materials". List reasons for a large company having two separate departments to manage the purchasing of each.

 Direct Materials

The materials required for producing a product are called direct materials. Direct materials are also known as raw materials or input materials. Direct raw materials constitute the main component or part of a finished product. It is identified in terms of cost per unit of output. Wood for furniture industry, sugarcane for sugar mills. Textile for garment industry is some of the examples of direct materials. Other example, the steel included in an automobile, the fabric used to assemble clothing.

Indirect Materials
The materials that can not be form as the main part of a finished product are called indirect materials. Therefore, such materials can not be easily identified with the product. Nails used in furniture industry and threads used in garment industry are some example of indirect materials.

Examples of indirect materials are:

·         Rags and solvents used during the construction of a house

·         The grease used on machines that manufacture products

·         The thread used in clothing

Q2: In about 200 words, describe the reasons a buyer might have for wanting to participate in an industry consortium marketplace instead of setting up its own private company marketplace.

Industry consortium of other words it is also known by the word of a partnership. Means of partnership is the relationship existing between two or more persons who join to carry on a trade or business. Each person contributes money, property, labor, or skill, and expects to share in the profit and losses of the business.

Advantage
The partner enters into a partnership agreement and start business. The partnership enjoys a better credit rating in the eyes of creditors. As the liability of each partner in the organization is unlimited, the financial institution can safely advance loan to the firms. Partnership can bring more capital o the business by the joint efforts of the partners. The partnership is normally in strong position to raise capital and expand the business. The profits of a registered firm, after payment of super tax, are divided among the partners. They pay tax to the government on their shares to profit. The partnership can also be legally dissolved without much difficult by mutual consent of the partners or in accordance with a contract by the partners.

Disadvantages
The one of the basic defect of the partnership is that the partners are personally and together responsible for all the debts of the firm. The duration of the partnership is always uncertain. If any partner die, injured, withdraws, sells his interest or a new partner is admitted into the business, the partnership comes to end. In partnership the misuse of the resources is raised by the partners. In case of any dispute among the partners, a delay may take place in decision-making process. This an cause loss to the firm

Q3: Which industries were the first to establish standard RFID technology? In about 100 words, state why, in your opinion, these industries were more interested in RFID tag technology than other industries

Radio frequency identification (RFID) is a generic term that is used to describe a system that transmits the identity (in the form of a unique serial number) of an object or person wireless, using radio waves. It's grouped under the broad category of automatic identification technologies. RFID is in use all around us. RFID data can be read through the human body, clothing and non-metallic materials

The first industry to establish RFID was used over sixty years ago by Britain to identify aircraft in World War II and was part of the refinement of radar. It was during the 1960s that RFID was first considered as a solution for the commercial world. These industries use it for security use, tracking, detecting distant objects and determining their position, track weather formations, wind speed etc.

RFID Business Benefits

Use of RFID technology can increase business productivity.

EXAMPLE:-

Ø  Improved Productivity and Cost Avoidance.

Ø  Decreased Cycle Time and Taking Costs Out.

Ø  Reduced Rework.

Ø  Reduced Business Risk & Control of Assets.

Ø  Improved Security and Service.

Ø  Improved Utilization of Resources.

Ø  Increased Revenues.

Ø  Exception Management.

Security and Access Control

RFID has long been used as an electronic key to control who has access to office buildings or areas within office buildings. The first access control systems used low-frequency RFID tags. Recently, vendors have introduced 13.56 MHz systems that offer longer read range. The advantage of RFID is it is convenient (an employee can hold up a badge to unlock a door, rather than looking for a key or swiping a magnetic stripe card) and because there is no contact between the card and reader, there is less wear and tear, and therefore less maintenance.

As RFID technology evolves and becomes less expensive and more robust, it's likely that companies and RFID vendors will develop many new applications to solve common and unique business problems

Conclusion

Awareness of RFID technology and the benefits it delivers is increasing across the industry. By playing a key role in developing the infrastructure required for RFID, Microsoft is contributing to the momentum of mass deployment. The fully-integrated Microsoft architecture for RFID embraces a vision for increased operational efficiency and reduced costs. Our RFID Council is also contributing to the development of the technology by helping organizations track items more effectively.