CPIM APICS Certified in Production and Inventory Management 5 — Questions and Answers
Question 1: What is the primary goal of vendor-managed inventory (VMI)?
- Transfer inventory ownership to the buyer at the point of use
- Allow the supplier to monitor and replenish the buyer's stock autonomously (Correct answer)
- Eliminate the need for safety stock entirely
- Reduce the number of approved suppliers
Correct answer: Allow the supplier to monitor and replenish the buyer's stock autonomously
In VMI, the supplier takes responsibility for monitoring inventory levels and initiating replenishment at the buyer's location.
Question 2: Which performance metric measures the percentage of customer orders shipped complete and on time on the first attempt?
- Fill rate
- Perfect order fulfillment (Correct answer)
- Order cycle time
- Backorder rate
Correct answer: Perfect order fulfillment
Perfect order fulfillment tracks orders that are delivered complete, on time, undamaged, and with correct documentation.
Question 3: In distribution requirements planning (DRP), what triggers a planned replenishment order at a field warehouse?
- A purchase requisition from the plant
- Projected inventory falling below the reorder point at that location (Correct answer)
- A customer complaint
- An MPS release from headquarters
Correct answer: Projected inventory falling below the reorder point at that location
DRP generates planned orders when projected on-hand inventory at a distribution location is expected to fall below its safety stock or reorder point.
Question 4: Which cost trade-off does the total cost curve in EOQ analysis balance?
- Carrying costs vs. stockout costs
- Ordering costs vs. carrying costs (Correct answer)
- Setup costs vs. labor costs
- Transportation costs vs. holding costs
Correct answer: Ordering costs vs. carrying costs
EOQ minimizes total annual inventory cost by finding the order quantity where ordering cost equals carrying cost.
Question 5: Which supply chain risk mitigation strategy involves sourcing the same component from multiple suppliers?
- Postponement
- Dual sourcing (Correct answer)
- Vertical integration
- Cross-docking
Correct answer: Dual sourcing
Dual (or multi) sourcing reduces supply disruption risk by preventing dependence on a single supplier.
Question 6: In a kanban system, what determines the number of kanban cards in circulation?
- The master production schedule quantity
- Average demand, lead time, safety stock, and container size (Correct answer)
- The supplier's minimum order quantity
- The warehouse capacity
Correct answer: Average demand, lead time, safety stock, and container size
The number of kanbans is calculated from demand rate, replenishment lead time, safety buffer, and container quantity.
Question 7: Which APICS CPIM module focuses specifically on execution and control of operations, including input/output control and scheduling?
- Basics of Supply Chain Management
- Master Planning of Resources
- Detailed Scheduling and Planning
- Execution and Control of Operations (Correct answer)
Correct answer: Execution and Control of Operations
The Execution and Control of Operations module covers shop floor control, input/output management, and performance measurement.
CPIM APICS Certified in Production and Inventory Management 5
What is the primary goal of vendor-managed inventory (VMI)?