CPT Inventory Management & Supply Chain 1

Question 1

What does 'JIT' stand for in manufacturing inventory management?

Accepted Answer

Just-In-Time

Answer

JIT (Just-In-Time) is an inventory strategy that minimizes waste by receiving goods only as they are needed in production.

Question 2

Which inventory review system places replenishment orders when stock falls to a predetermined reorder point?

Accepted Answer

Continuous review system

Answer

A continuous review (perpetual) system constantly monitors stock levels and triggers replenishment orders when inventory reaches the reorder point.

Question 3

In supply chain management, 'lead time' refers to:

Accepted Answer

Time between placing an order and receiving it

Answer

Lead time is the elapsed time from when an order is placed until the ordered items are received and available for use.

Question 4

Which inventory valuation method assumes the first items purchased are the first items sold or used?

Accepted Answer

FIFO

Answer

FIFO (First-In, First-Out) assumes that the oldest inventory is consumed first, which matches the natural flow of most perishable goods.

Question 5

What is 'safety stock' primarily maintained to address?

Accepted Answer

Unexpected demand increases or supply delays

Answer

Safety stock is extra inventory held as a buffer to prevent stockouts caused by unexpected spikes in demand or delays in replenishment.

(CPT) Certified Production Technician Practice Test