Store Management WASSCE (SC), 2022

Question  3

  1. (a)What is a bonded warehouse?

    (b)Explain three ways in which a bonded warehouse may be useful in international trade.

    (c)List and explain three stock control levels.

Observation

 

  1. Comments

    (i)A large number of candidates were able to answer question 3(a) very well.

    (ii)Candidates performed averagely in question 3(b) and performed well in 3(c)

    .

    (a) Bonded warehouse is a place where goods whose owners have not paid the required duties are kept on till the duties on them are paid.

     

                (b)       Usefulness of a bonded warehouse in International trade

    (i)It provides the importers with a reasonable time within which he can pay duty on the goods imported;

    (ii)The importers can also complete some processing on the goods while in bond;

    (iii)Effective check on the goods in-bond can be made by the customs authority so as to ascertain import duties, contraband goods etc;

    (iv)It gives the importers an opportunity to arrange for buyers while the goods are in bond;

    (v)Safety of goods imported is also guaranteed;

    (vi)It frees space at the port for other shipments;

    (vii)It helps importers to manage their inventory and cash flow;

    (viii)It improves customer service; and

    (ix)It ensures quality assurance of products.

                (c)        Stock control levels

    (i)Reorder level: This is the level at which a replacement order is made and this will ensure that the order would have arrived before running out of stock.

    (ii)Maximum stock level: This is the level at which stock should not exceed and this will help to prevent overstocking and the cost associated with it.

     

    (iii)Minimum stock level: This is the level below which stock should not fall and this will help to prevent stock-out which leads to production stoppage.

    (iv)Average stock level: This is the average stock held by a firm.