Practice Test GeeksCPIM - Certified in Production and Inventory Management Practice Test
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Sample Flashcards

7 cards from real CPIM practice questions. Tap to flip, then mark Knew It or Still Learning — missed cards come back until you master them.

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  1. Which of the following best describes the difference between 'efficiency' and 'utilization' in capacity management?

    Answer: Efficiency measures actual output vs. standard output; utilization measures actual hours worked vs. available hours

    Efficiency compares actual output to the standard (expected) output for hours worked, while utilization compares actual hours worked to total hours available.

  2. A company is experiencing high levels of work-in-process (WIP) inventory. According to Little's Law, which action would MOST directly reduce WIP?

    Answer: Reducing cycle time in the system

    Little's Law states WIP = Throughput Rate × Cycle Time; reducing cycle time directly reduces WIP for a given throughput rate.

  3. The Sales and Operations Planning (S&OP) process is PRIMARILY designed to:

    Answer: Balance supply and demand at an aggregate level across the business

    S&OP aligns demand plans with supply capabilities at an aggregate (family/group) level, coordinating across sales, operations, finance, and executive leadership.

  4. In the Theory of Constraints (TOC), what is the term for the step of making the most effective use of the system's constraint?

    Answer: Exploit the constraint

    Exploiting the constraint means maximizing the output of the bottleneck resource without spending additional money, such as eliminating downtime and scrap at the constraint.

  5. Which inventory valuation method results in the HIGHEST reported profit during a period of rising prices?

    Answer: FIFO (First In, First Out)

    Under FIFO, the oldest (lowest-cost) inventory is sold first, leaving newer (higher-cost) inventory on the balance sheet, which results in lower COGS and higher reported profit during inflation.

  6. A supplier's 'on-time delivery' performance is measured at 85%. In a lean supply chain context, this performance level is:

    Answer: Inadequate because JIT environments require near-perfect delivery reliability

    Lean and JIT environments depend on highly reliable supplier delivery (typically 98%+) because minimal safety stock exists to buffer against unreliability.

  7. The master production schedule (MPS) operates within which planning horizon relationship?

    Answer: It must extend beyond the cumulative lead time for all purchased and manufactured items

    The MPS planning horizon must be at least as long as the longest cumulative lead time (sum of procurement and manufacturing lead times) to ensure materials can be ordered in time.