CPIM 8.0 Practice tests Exam Questions and Answers
with Rationales.
Using ABC classification for cycle counting, A items are counted every week, B items are
counted quarterly, and C items are counted annually. There are 2,000 A items, 5,000 B
items, and 20,000 C items. How many items are counted each day in total if there are 50
working weeks in the year translating to 250 workdays in the year?
A. 574 units
B. 404 units
C. 395 units
D. 560 units - Correct Answer D. 560 units
To determine the total number of items to count, multiply the number of items by the
number of times the item is counted for each class and then sum the results. A items are
counted weekly, so this is 50 times per year: 2,000 units × 50 weeks = 100,000 counts. B
items are counted quarterly, so this is 4 times per year: 5,000 × 4 = 20,000 counts. C items
are counted once, so this is just 20,000 counts. Next, sum the counts: 100,000 counts +
20,000 counts + 20,000 counts = 140,000 counts. Then divide this sum by the number of
manufacturing calendar days in the year: 140,000 counts/250 days = 560 counts per day.
With which of the following modes of transportation does the carrier typically have the
highest fixed costs?
A. Rail
B. Air
C. Road
D. Water - Correct Answer A. Rail
In contrast to variable costs, fixed costs do not change with the volume of goods carried.
Railways have large fixed costs, for example, tracks, terminals, and vehicles.
Senior management agrees to expedite a customer order. After being notified, what
should operations managers do first?
A. Ignore the expediting if it is within the demand time fence.
B. Evaluate lateral and downstream operations for impact on schedules and costs.
C. Increase capacity to enable handling the normal schedule plus the increased load.
D. Add the expedited order to the top of the schedule and automatically reschedule
everything else. - Correct Answer B. Evaluate lateral and downstream operations for
impact on schedules and costs.
After detecting exceptions to plans, operations managers need to follow an exception
management process, which includes evaluating lateral and downstream operations for
their impact on schedules and costs. Since senior management has approved this
expediting, it is not possible to just ignore it. Adding the expedited order to the top of the
queue might be done, but it would be a later step after evaluating impact and feasibility.
In addition to customer orders, the master production schedule (MPS) might handle which
of the following types of demand?
A. Dependent demand
,B. Interplant orders
C. Parts list items
D. Bill-of-material items - Correct Answer B. Interplant orders
Interplant demand is usually handled by the master production scheduling system in a
manner similar to customer orders.
An organization implements a dock-to-stock program with a key supplier. How will this
impact the total cost of ownership (TCO) if the program is implemented correctly?
A. TCO will not be affected because passing costs on to the supplier cannot improve costs
from a total supply chain perspective.
B. TCO will be lower due to no receiving and inspection without a higher average cost of
poor quality.
C. TCO will initially be higher but will eventually be lower as the cost of poor quality goes
down.
D. TCO will be higher because the costs of supplier relationship management will more
than offset shorter lead times from such a program. - Correct Answer B. TCO will be lower
due to no receiving and inspection without a higher average cost of poor quality.
The total cost of ownership in supply chain management speaks to the sum of all the costs
associated with every activity of the supply stream. In this case, dock-to-stock is a
program through which specific quality and packaging requirements are met before the
product is released. Prequalified product is shipped directly into the customer's inventory.
Dock-to-stock eliminates the costly handling of components, specifically in receiving and
inspection, and enables product to move directly into production. If the program is
implemented correctly, the costs of poor quality should not increase. Even from a total
supply chain perspective, TCO will decrease because only one party is performing these
quality steps rather than both parties doing the same task.
What is the best reason for closing the loop between master scheduling and sales and
operations planning (S&OP)?
A. One is the plan, and one confirms execution of the plan.
B. One is the plan, and one shows where the plan is valid.
C. One is the plan, and one is the execution of the plan.
D. One is the plan, and one confirms resource availability. - Correct Answer C. One is the
plan, and one is the execution of the plan.
S&OP is the plan, and master scheduling identifies how the plan will be executed.
Large-scale productivity software often experiences implementation delays or initially
performs below expectations. What mitigation strategy could be used in this situation?
A. Budget for additional time and reduced performance after implementation.
B. Implement it in small pieces while keeping existing systems in place.
C. Keep the old system running in parallel until there is 100% functionality and user
acceptance.
D. Hire a third party to implement it. - Correct Answer A. Budget for additional time and
reduced performance after implementation.
With productivity software implementations, it is often the case that performance drops
below existing and projected levels until the application "works as expected."
,Which of the following statements is true of inventory when the final product design is
continuously influenced by the customer?
A. Large safety stocks must be maintained.
B. Lot-size inventory increases to the finished goods level.
C. Buffer inventory should be held closer to the raw material stage.
D. Customer influence on the product design should not affect inventory levels. - Correct
Answer C. Buffer inventory should be held closer to the raw material stage.
Because the final configured item is often not determined until the actual customer order,
leaving materials and components in an unfinished state significantly reduces stocked
finished goods. The materials and components are then made- or assembled-to-order
based on customer specifications. Increasing the lot-size inventory to the finished goods
level will only build inventory as the company waits for a customer order with pre-designed
configurations. Large safety stocks further increase the amount of finished goods
maintained in inventory. Unless the customer requires only off-the-shelf products, the
production and inventory functions must be flexible to build any customer configuration.
Which of the following is a voluntary initiative whereby companies embrace, support, and
enact, within their sphere of influence, a set of core values in the areas of human rights,
labor standards, the environment, and anti-corruption?
A. United Nations Police
B. United Nations Global Education First Initiative
C. United Nations Global Compact
D. United Nations Global Initiative to Fight Human Trafficking - Correct Answer C. United
Nations Global Compact
The UN Global Compact is a strategic policy initiative for businesses that are committed to
aligning their operations and strategies with ten universally accepted principles in the
areas of human rights, labor, the environment, and anti-corruption.
Which of the following can be identified and adjusted at the rough-cut capacity planning
level?
A. Excessive queues at suppliers
B. Underloads at all work centers
C. Overloads at all work centers
D. Total hours of load in excess of plant capacity - Correct Answer D. Total hours of load in
excess of plant capacity
Rough-cut capacity planning provides planners with the ability to easily identify overloads
and underloads at key bottlenecks or critical work centers (not all work centers) in the
plant.
If a make-to-stock (MTS) company shifts its manufacturing operations to make-to-order
(MTO), what will be the effect on annual setup costs and delivery lead time?
A. Annual setup costs will decrease and delivery lead time will decrease.
B. Annual setup costs will decrease and delivery lead time will increase.
C. Annual setup costs will increase and delivery lead time will decrease.
, D. Annual setup costs will increase and delivery lead time will increase. - Correct Answer
D. Annual setup costs will increase and delivery lead time will increase.
Moving to an MTO environment means that smaller-volume orders will be created. This
will increase the overall factory setup costs. Delivery lead times will also increase.
Which of the following objectives often conflicts with providing the best customer service?
A. Building special customer order configurations
B. Creating an extensive and costly distribution system
C. Reducing inventory to keep inventory carrying costs at a minimum
D. Interrupting production runs so a shortage can be manufactured - Correct Answer C.
Reducing inventory to keep inventory carrying costs at a minimum
Production's objective of keeping inventory investment to a minimum is in conflict with
marketing's objective of always having goods available for the customer. A complex
distribution system assists in providing the best customer service and is not in conflict.
Disrupting the production schedule for shortage runs decreases manufacturing
productivity. Building special customer order configurations decreases production's
objectives of making long runs of a small number of standardized products.
When allocated on the basis of historical direct labor hours, overhead will be properly
absorbed if:
A. total volume increases.
B. total volume decreases.
C. total volume remains unchanged.
D. fixed costs decrease. - Correct Answer C. total volume remains unchanged.
If production volume remains stable, then the standard overhead that was originally
calculated will also remain stable.
What is the primary difference between enterprise resources planning (ERP) and
manufacturing resource planning (MRP II)?
A. ERP provides a balance between production, marketing, and information technology.
B. ERP includes manufacturing information only.
C. ERP integrates additional business functions, including human resources, research
and development, logistics, and others.
D. ERP is computer-based, but MRP II is no - Correct Answer C. ERP integrates
additional business functions, including human resources, research and development,
logistics, and others.
ERP provides more than just manufacturing information; it integrates business functions
like human resources, research and development, and logistics. MRP II and ERP are both
computer-based, and both provide a balance between production, marketing, and
information technology.
Which of the following is more characteristic of a general business contract than a
customer-supplier partnership?
A. Supplier dedicates a portion of its capacity over a long-term basis to the customer.
B. Distributor provides all of the company's hardware and standard electrical components.
