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Question 164

You are setting up a new company for a customer.

The customer wants to sell items in boxes and pallets, but refer to the items as pieces. Each box contains 12 pieces. Each pallet contains 144 pieces.

You need to assign the unit of measures to items.

How should you assign the unit of measures?

Create Pieces as an item unit of measure with a quantity per unit of measure set to 1.

Create Pallet as a base unit of measure. Add Box as an item unit of measure with the quantity per unit set to 0.08333.

Create Pallet as a base unit of measure. Add Pieces as an item unit of measure with the quantity per unit set to 0.0069.

Create Pieces as a base unit of measure. Add Box as an item unit of measure with the quantity per unit set to 12.

Correct Answer: D

To correctly set up units of measure for items sold as pieces, boxes, and pallets, you should use pieces as the base unit of measure since it is the smallest quantity and the standard that both boxes and pallets refer to. A box, which contains 12 pieces, can be defined with a quantity per unit of measure set to 12, and a pallet, which contains 144 pieces, can be defined with a quantity per unit of measure set to 144. This makes it easier to manage inventory accurately, as all other units can be derived from the base unit of pieces.

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