APICS CLTD – Certified in Logistics, Transportation and Distribution — Questions and Answers

Question 1: Which framework uses a heat map plotting likelihood versus impact to prioritize supply chain risks?

SWOT analysis
Value stream mapping
Balanced scorecard
Risk probability-impact matrix (Correct answer)

Correct answer: Risk probability-impact matrix

A risk probability-impact matrix categorizes risks by their likelihood of occurrence and potential severity, helping teams focus mitigation resources.

Question 2: What does VMI stand for in supply chain management?

Value Management Integration
Volume Measurement Indicator
Variable Markup Index
Vendor-Managed Inventory (Correct answer)

Correct answer: Vendor-Managed Inventory

Vendor-Managed Inventory (VMI) allows suppliers to monitor and replenish a buyer's inventory levels without requiring purchase orders.

Question 3: What is the purpose of a supply chain control tower?

A quality control inspection center
Air traffic control for logistics aircraft
A centralized hub providing real-time visibility and decision-support across the entire supply chain (Correct answer)
A customs clearance monitoring system

Correct answer: A centralized hub providing real-time visibility and decision-support across the entire supply chain

A supply chain control tower aggregates data from across the supply chain to provide visibility, analytics, and coordinated response to disruptions.

Question 4: What is a free trade zone (FTZ) in the United States?

A domestic area exempt from all sales taxes
A port open exclusively to government cargo
A designated area where goods can be imported, stored, and processed with deferred or reduced customs duties (Correct answer)
A tariff-free zone between US states

Correct answer: A designated area where goods can be imported, stored, and processed with deferred or reduced customs duties

US Foreign Trade Zones allow companies to defer, reduce, or eliminate customs duties on imported goods used in manufacturing or re-exported.

Question 5: A black swan event in supply chain risk management refers to:

A rare, high-impact, hard-to-predict disruption (Correct answer)
A minor supplier quality defect
A routine freight delay
A predictable seasonal demand spike

Correct answer: A rare, high-impact, hard-to-predict disruption

Black swan events are highly improbable, high-consequence disruptions—such as a pandemic or major natural disaster—that are difficult to anticipate.

Question 6: What is a bill of lading (BOL)?

A customs clearance form
A legal document between a shipper and carrier detailing shipment terms (Correct answer)
A freight invoice
A delivery confirmation receipt

Correct answer: A legal document between a shipper and carrier detailing shipment terms

A bill of lading is the primary shipping document that serves as a receipt, contract of carriage, and document of title.

Question 7: What does LTL stand for in freight shipping?

Less-Than-Truckload (Correct answer)
Landed Total Load
Long Transit Logistics
Local Transport License

Correct answer: Less-Than-Truckload

LTL (Less-Than-Truckload) shipping combines freight from multiple shippers into a single truck, lowering costs for smaller loads.

Question 8: What is supply chain resilience?

The capacity to anticipate, adapt to, and quickly recover from supply chain disruptions (Correct answer)
Using only domestic suppliers for shorter lead times
Maintaining maximum inventory levels at all times
The ability to achieve the lowest possible cost structure

Correct answer: The capacity to anticipate, adapt to, and quickly recover from supply chain disruptions

Supply chain resilience enables companies to withstand and recover from disruptions—whether natural, economic, or geopolitical—while maintaining customer service.

Question 9: What does 'carrier liability' mean in freight transportation?

Insurance coverage paid by the consignee
The shipper's responsibility for packing goods properly
A surcharge for hazardous materials
The legal responsibility of a carrier for loss or damage to freight in its possession (Correct answer)

Correct answer: The legal responsibility of a carrier for loss or damage to freight in its possession

Carrier liability defines the financial responsibility a transportation company bears for lost or damaged goods while in transit.

Question 10: What is spend analysis in procurement?

Evaluating supplier quality scores
Calculating freight cost per shipment
Reviewing budget variances monthly
Examining and categorizing all organizational expenditures to identify savings opportunities (Correct answer)

Correct answer: Examining and categorizing all organizational expenditures to identify savings opportunities

Spend analysis aggregates, cleanses, and categorizes purchasing data to identify cost-saving opportunities, consolidation potential, and compliance issues.

Question 11: What is the primary goal of ABC analysis in inventory control?

Automate reordering
Prioritize inventory items by value and volume (Correct answer)
Alphabetically organize SKUs
Track supplier performance

Correct answer: Prioritize inventory items by value and volume

ABC analysis classifies inventory into A (high value), B (moderate), and C (low value) categories to focus management effort.

Question 12: What is a TMS in logistics operations?

Terminal Monitoring Service
Transportation Management System (Correct answer)
Tariff Management Schedule
Total Margin Summary

Correct answer: Transportation Management System

A Transportation Management System (TMS) is software that plans, executes, and optimizes the movement of goods.

Question 13: A company decides to hold a strategic inventory reserve at a neutral warehouse in case its primary supplier fails. This tactic is best described as:

Supply chain hedge inventory (Correct answer)
Demand smoothing
Vendor-managed inventory
Just-in-time replenishment

Correct answer: Supply chain hedge inventory

Hedge inventory is safety stock held specifically as insurance against supply disruptions, separate from regular cycle or safety stock calculations.

Question 14: Which shipping term means the seller bears all costs and risks until goods are delivered to the buyer's named place?

EXW
FCA
CPT
DDP (Correct answer)

Correct answer: DDP

DDP (Delivered Duty Paid) requires the seller to handle all transportation costs, duties, and taxes until delivery at the destination.

Question 15: Which inventory valuation method results in the lowest net income during rising prices?

FIFO
Specific Identification
LIFO (Correct answer)
Weighted Average

Correct answer: LIFO

LIFO (Last In, First Out) reports the most recently purchased (higher-cost) goods as sold first, increasing COGS and reducing net income during inflation.

Question 16: What does SKU stand for in warehouse operations?

Shipment Kickoff Upgrade
Supply Key Uplink
Stock Keeping Unit (Correct answer)
Standard Kit Utilization

Correct answer: Stock Keeping Unit

A SKU (Stock Keeping Unit) is a unique alphanumeric identifier assigned to a specific product for inventory tracking.

Question 17: What is intermodal transportation?

Direct-to-consumer delivery
Moving freight using two or more transportation modes without handling the cargo itself (Correct answer)
Shipping only via air and sea
International customs brokerage

Correct answer: Moving freight using two or more transportation modes without handling the cargo itself

Intermodal transportation transfers cargo in a single container between truck, rail, and ship without repacking the goods.

Question 18: Which of the following best describes the 'bullwhip effect' as a supply chain risk?

Price volatility in raw material markets
Customs delays caused by incorrect documentation
Overproduction due to machine breakdowns
Demand signal distortion that amplifies order variability upstream (Correct answer)

Correct answer: Demand signal distortion that amplifies order variability upstream

The bullwhip effect is when small fluctuations in end-customer demand get magnified as orders travel upstream, causing excess inventory or shortages.

Question 19: What is supply chain visibility?

The ability to track products, inventory, and orders in real time across the supply chain (Correct answer)
Monitoring employee performance in logistics roles
Making supplier contracts transparent to all employees
Publishing supply chain data publicly

Correct answer: The ability to track products, inventory, and orders in real time across the supply chain

Supply chain visibility provides real-time data on inventory locations, order statuses, and supplier activities to enable proactive decision-making.

Question 20: What is a distribution center (DC) and how does it differ from a traditional warehouse?

A DC is smaller than a warehouse
A DC focuses on rapid product flow and order fulfillment while a warehouse emphasizes long-term storage (Correct answer)
A DC stores goods long-term while a warehouse ships directly to customers
A DC handles imports only while a warehouse handles domestic goods

Correct answer: A DC focuses on rapid product flow and order fulfillment while a warehouse emphasizes long-term storage

A distribution center is optimized for high-velocity order fulfillment and rapid throughput, whereas traditional warehouses prioritize bulk storage.

Question 21: What is nearshoring in sourcing strategy?

Consolidating all suppliers into one location
Sourcing from domestic suppliers only
Relocating production or sourcing to nearby countries rather than distant ones (Correct answer)
Offshoring production to the lowest-cost country

Correct answer: Relocating production or sourcing to nearby countries rather than distant ones

Nearshoring moves operations or sourcing to geographically close countries to reduce lead times, logistics costs, and time zone differences.

Question 22: What is supplier diversification?

Using one supplier for all products
Offering suppliers equity stake
Expanding into new product categories
Using multiple suppliers to reduce dependency and supply risk (Correct answer)

Correct answer: Using multiple suppliers to reduce dependency and supply risk

Supplier diversification spreads purchases across multiple vendors to avoid over-reliance on a single source and reduce disruption risk.

Question 23: Which type of supply chain risk arises from a single supplier being the sole source for a critical component?

Demand risk
Transportation delay risk
Single-source dependency risk (Correct answer)
Currency fluctuation risk

Correct answer: Single-source dependency risk

Single-source dependency risk occurs when only one supplier can provide a critical input, leaving the buyer vulnerable if that supplier fails.

Question 24: What is a Kraljic matrix used for?

Mapping warehouse layout
Classifying purchased items by supply risk and profit impact to guide sourcing strategy (Correct answer)
Measuring supplier delivery performance
Calculating safety stock levels

Correct answer: Classifying purchased items by supply risk and profit impact to guide sourcing strategy

The Kraljic matrix plots items on axes of supply risk and profit impact to classify them as routine, leverage, bottleneck, or strategic.

Question 25: The concept of 'supply chain agility' in risk management means:

The ability to rapidly reconfigure supply chain operations in response to unexpected changes (Correct answer)
Negotiating flexible payment terms with suppliers
Maintaining the lowest possible inventory levels at all times
Using the fastest available transportation mode

Correct answer: The ability to rapidly reconfigure supply chain operations in response to unexpected changes

Agility refers to a supply chain's capacity to sense disruptions quickly and restructure sourcing, production, or logistics rapidly to maintain service levels.

Question 26: Which of the following events would be classified as a 'force majeure' supply chain disruption?

An earthquake destroying a key manufacturing facility (Correct answer)
A customer requesting shorter lead times
A supplier raising its prices by 5%
A 3PL switching to a new warehouse management system

Correct answer: An earthquake destroying a key manufacturing facility

Force majeure refers to extraordinary, unforeseeable events—such as natural disasters—beyond the control of the parties involved, typically excusing contractual non-performance.

Question 27: What is the purpose of a proof of delivery (POD)?

Authorize carrier payment
Initiate a freight claim
Schedule pickup from shipper
Confirm that a shipment was received by the consignee (Correct answer)

Correct answer: Confirm that a shipment was received by the consignee

A proof of delivery is a signed document confirming the shipment was received in good condition by the recipient.

Question 28: What does demand forecasting involve in supply chain planning?

Calculating safety stock formulas
Estimating transportation costs for the next quarter
Predicting future customer demand to guide production, procurement, and inventory decisions (Correct answer)
Setting supplier delivery schedules

Correct answer: Predicting future customer demand to guide production, procurement, and inventory decisions

Demand forecasting uses historical data, market trends, and statistical models to predict future sales and guide supply chain planning.

Question 29: What is a load factor in air cargo operations?

Number of stops per flight
Fuel cost per kilogram
Ratio of cargo weight carried to maximum capacity (Correct answer)
Customs duty rate

Correct answer: Ratio of cargo weight carried to maximum capacity

Load factor measures the percentage of available cargo capacity actually filled, indicating operational efficiency for airlines.

Question 30: What is the Harmonized System (HS) code?

A container size classification system
A US-only tariff classification system
An internationally standardized numerical code used to classify traded products for customs and tariff purposes (Correct answer)
A carrier tracking number format

Correct answer: An internationally standardized numerical code used to classify traded products for customs and tariff purposes

The HS code is a 6-digit international system maintained by the World Customs Organization for classifying goods in international trade.

Question 31: Which risk mitigation strategy involves holding safety stock to protect against supply disruptions?

Risk sharing
Risk transfer
Risk buffering (Correct answer)
Risk avoidance

Correct answer: Risk buffering

Risk buffering uses inventory buffers (safety stock) or capacity reserves to absorb supply or demand shocks.

Question 32: Cybersecurity threats are increasingly important in supply chain risk because:

Digital systems and data sharing across partners create vulnerabilities to hacking and ransomware (Correct answer)
They do not affect physical goods movement
They are fully covered by standard cargo insurance
They only affect retail companies

Correct answer: Digital systems and data sharing across partners create vulnerabilities to hacking and ransomware

Modern supply chains rely on interconnected digital platforms; a cyberattack on any node—such as an ERP system—can halt orders, shipments, and payments across the network.

Question 33: Supply chain visibility tools help manage risk primarily by:

Providing real-time data on inventory, shipments, and supplier status to detect disruptions early (Correct answer)
Eliminating the need for safety stock entirely
Replacing demand forecasting models
Automating supplier contract negotiation

Correct answer: Providing real-time data on inventory, shipments, and supplier status to detect disruptions early

Real-time visibility platforms give supply chain managers early warning of delays, shortages, or disruptions so they can respond proactively.

Question 34: What is the USMCA and how does it affect US trade?

A customs automation system shared by North American ports
A US maritime authority regulating coastal shipping
A US small-business export promotion program
The US-Mexico-Canada Agreement that replaced NAFTA, governing trade rules between the three countries (Correct answer)

Correct answer: The US-Mexico-Canada Agreement that replaced NAFTA, governing trade rules between the three countries

USMCA (effective 2020) sets rules of origin, labor standards, and intellectual property protections governing duty-free trade among the US, Mexico, and Canada.

Question 35: What is the 'last mile' in logistics?

Supplier lead time
Final leg of a delivery from a local hub to the end customer (Correct answer)
International customs clearance
Warehouse replenishment cycle

Correct answer: Final leg of a delivery from a local hub to the end customer

Last-mile delivery is the final and often most expensive step of the supply chain, moving goods from a distribution center to the customer's door.

Question 36: What is INCOTERMS 2020?

A UN framework for anti-dumping measures
A US customs tariff schedule effective in 2020
A global shipping container standardization agreement
Internationally recognized trade terms published by the ICC that define buyer and seller responsibilities in international transactions (Correct answer)

Correct answer: Internationally recognized trade terms published by the ICC that define buyer and seller responsibilities in international transactions

Incoterms 2020 are 11 standardized ICC rules defining cost, risk, and responsibility split between buyers and sellers in international contracts.

Question 37: What is Sales and Operations Planning (S&OP)?

A software tool for route optimization
A customer service escalation protocol
A warehouse layout optimization method
A cross-functional process that aligns demand, supply, and financial plans (Correct answer)

Correct answer: A cross-functional process that aligns demand, supply, and financial plans

S&OP integrates demand forecasting, supply planning, and financial planning to align the whole organization on one operating plan.

Question 38: What is shrink wrap used for in warehouse operations?

Securing and stabilizing pallet loads for safe storage and transport (Correct answer)
Protecting conveyor belts from dust
Moisture-proofing warehouse floors
Sealing cold storage rooms

Correct answer: Securing and stabilizing pallet loads for safe storage and transport

Stretch or shrink wrap is applied around pallet loads to unitize products, prevent shifting, and protect from dust and moisture in transit.

Question 39: What does TCO stand for in procurement?

Terms and Conditions of Operation
Total Cost of Ownership (Correct answer)
Tariff Classification Overview
Trade Compliance Order

Correct answer: Total Cost of Ownership

Total Cost of Ownership encompasses all costs associated with acquiring, operating, and disposing of a product or service over its lifetime.

Question 40: What is a pick-and-pack operation?

Loading full pallets onto outbound trucks
Selecting suppliers and packaging contracts
Unpacking bulk goods from supplier containers
Retrieving specific items from warehouse storage and packaging them for individual customer orders (Correct answer)

Correct answer: Retrieving specific items from warehouse storage and packaging them for individual customer orders

Pick-and-pack involves selecting individual items from warehouse locations and packaging them into customer-specific shipments.

Question 41: Which approach keeps inventory levels extremely low by receiving goods only as they are needed?

Economic Order Quantity
Vendor-Managed Inventory
Just-in-Time (JIT) (Correct answer)
Cross-docking

Correct answer: Just-in-Time (JIT)

Just-in-Time inventory reduces waste and holding costs by timing deliveries to match production or sales demand precisely.

Question 42: What is a bonded warehouse?

A cold-storage facility for perishables
A shared warehouse used by multiple tenants
A warehouse certified for organic products
A licensed facility where imported goods are stored without paying customs duties until released (Correct answer)

Correct answer: A licensed facility where imported goods are stored without paying customs duties until released

A bonded warehouse allows importers to defer customs duties and taxes until goods are withdrawn for sale or use.

Question 43: What is demand sensing in supply chain planning?

Using near real-time data signals to improve short-term demand forecasts (Correct answer)
Installing IoT sensors in retail stores
Measuring warehouse temperature to predict product spoilage
Detecting fraudulent customer orders

Correct answer: Using near real-time data signals to improve short-term demand forecasts

Demand sensing uses point-of-sale data, inventory levels, and market signals to create highly accurate short-horizon demand forecasts.

Question 44: Geopolitical risk in supply chain management includes which of the following?

Seasonal demand fluctuations
Internal warehouse theft
Trade tariffs and export controls affecting cross-border sourcing (Correct answer)
Supplier payment terms

Correct answer: Trade tariffs and export controls affecting cross-border sourcing

Geopolitical risk encompasses government actions such as tariffs, sanctions, and export controls that can disrupt international supply flows.

Question 45: What is the purpose of an export license in US trade compliance?

Authorize a freight forwarder to act on a shipper's behalf
Register a company as an exporter with CBP
Certify that exported goods meet quality standards
Government authorization required to export controlled goods, technology, or services to certain destinations or end users (Correct answer)

Correct answer: Government authorization required to export controlled goods, technology, or services to certain destinations or end users

An export license is required for controlled items under the EAR or ITAR when exported to certain countries, entities, or for prohibited end uses.

Question 46: What is collaborative planning, forecasting, and replenishment (CPFR)?

An internal financial forecasting tool
A software certification program
A government reporting standard for food supply
A supply chain best practice where trading partners jointly develop forecasts and replenishment plans (Correct answer)

Correct answer: A supply chain best practice where trading partners jointly develop forecasts and replenishment plans

CPFR improves supply chain efficiency by sharing forecasting, promotional, and inventory data between retailers and suppliers.

Question 47: What is a letter of credit (LC) in international trade?

A government export subsidy
A supplier credit check report
A duty-free import authorization
A bank-issued payment guarantee that ensures sellers are paid when they meet specified documentary conditions (Correct answer)

Correct answer: A bank-issued payment guarantee that ensures sellers are paid when they meet specified documentary conditions

A letter of credit is a financial instrument issued by a buyer's bank guaranteeing payment to the seller upon presentation of compliant shipping documents.

Question 48: What is the purpose of a Request for Proposal (RFP)?

Document inventory adjustments
Authorize payment to a supplier
Confirm delivery of purchased goods
Solicit detailed proposals from vendors for a product or service (Correct answer)

Correct answer: Solicit detailed proposals from vendors for a product or service

An RFP invites vendors to submit proposals detailing how they would fulfill a buyer's requirements, enabling competitive evaluation.

Question 49: What does 'dead stock' refer to in inventory management?

Items in transit
Returned merchandise
Inventory that has never been sold and is unlikely to be sold (Correct answer)
Items awaiting quality inspection

Correct answer: Inventory that has never been sold and is unlikely to be sold

Dead stock consists of unsold inventory that occupies storage space and ties up capital without generating revenue.

Question 50: What does 'supply risk' refer to in procurement?

Currency fluctuation on foreign purchases
Probability of supply disruption affecting the ability to obtain required goods or services (Correct answer)
Risk of employee theft from stockrooms
Risk of overpaying for goods

Correct answer: Probability of supply disruption affecting the ability to obtain required goods or services

Supply risk encompasses factors like supplier financial instability, geopolitical events, natural disasters, and single-source dependency.

Question 51: What is ocean freight demurrage and detention in international shipping?

Charges for cargo damaged at sea and associated legal proceedings
Port storage fees and carrier rebooking penalties
Demurrage is charged for holding containers at the port; detention is charged for holding containers off-port beyond free time (Correct answer)
Overage charges for exceeding vessel weight limits

Correct answer: Demurrage is charged for holding containers at the port; detention is charged for holding containers off-port beyond free time

Demurrage applies when containers remain at the port terminal past free days; detention applies when containers are held outside the port at importers' or exporters' facilities.

Question 52: Which metric measures how many times inventory is sold and replaced over a period?

Days sales outstanding
Fill rate
Inventory turnover (Correct answer)
Carrying cost ratio

Correct answer: Inventory turnover

Inventory turnover ratio equals cost of goods sold divided by average inventory, indicating how efficiently stock is managed.

Question 53: What is a purchase order (PO)?

A vendor invoice
A request for a price quote
A receiving inspection report
A legally binding document sent to a supplier authorizing a purchase (Correct answer)

Correct answer: A legally binding document sent to a supplier authorizing a purchase

A purchase order is a commercial document issued by a buyer to a seller specifying goods, quantities, prices, and delivery terms.

Question 54: What does the term 'freight class' determine in LTL shipping?

Carrier insurance requirements
Priority of delivery
Container size required
Shipping rate based on density, stowability, handling, and liability (Correct answer)

Correct answer: Shipping rate based on density, stowability, handling, and liability

The National Motor Freight Classification (NMFC) assigns freight classes 50–500 based on density, handling ease, stowability, and liability.

Question 55: Near-shoring as a risk mitigation strategy refers to:

Storing inventory near customer delivery points
Moving production or sourcing to nearby countries to reduce lead times and geopolitical exposure (Correct answer)
Outsourcing logistics to a 3PL provider
Sourcing exclusively from domestic suppliers

Correct answer: Moving production or sourcing to nearby countries to reduce lead times and geopolitical exposure

Near-shoring relocates supply chain activities to neighboring or regionally close countries, balancing cost savings with reduced lead times and lower geopolitical risk compared to distant offshore sources.

Question 56: What is a lumper in warehouse terminology?

A quality defect in packaging
A bulk storage rack system
A contract labor worker who unloads trucks at a facility (Correct answer)
A heavy-duty forklift model

Correct answer: A contract labor worker who unloads trucks at a facility

A lumper is a temporary worker hired by a carrier or receiver to unload freight from trailers at a warehouse or distribution center.

Question 57: What is a make-to-order (MTO) production strategy?

Manufacturing products only after a confirmed customer order is received (Correct answer)
Ordering raw materials on a monthly basis
Making products to standard quality only when reorder points are hit
Building large amounts of inventory in advance of demand

Correct answer: Manufacturing products only after a confirmed customer order is received

Make-to-order production starts only after a customer order is placed, reducing finished goods inventory while increasing lead times.

Question 58: What is a pallet rack?

A metal shelving system designed to store palletized goods in horizontal rows and vertical bays (Correct answer)
A vehicle for moving pallets in a warehouse
A quality inspection table
A shipping label printer stand

Correct answer: A metal shelving system designed to store palletized goods in horizontal rows and vertical bays

Pallet racking systems maximize vertical warehouse space and provide organized, accessible storage for bulk palletized inventory.

Question 59: What is anti-dumping duty?

A fee for disposing of hazardous cargo
A surcharge for late delivery of imports
A penalty for undervaluing goods on customs declarations
An import tariff imposed to counteract foreign goods sold in a country at below-market prices (Correct answer)

Correct answer: An import tariff imposed to counteract foreign goods sold in a country at below-market prices

Anti-dumping duties are imposed when foreign manufacturers sell goods at prices below their home market price or production cost, harming domestic industry.

Question 60: What is a receiving inspection in warehouse operations?

Auditing supplier invoices for billing accuracy
Inspecting warehouse equipment for safety compliance
Reviewing outbound shipments for accuracy
Verifying that inbound goods match purchase orders and meet quality standards before accepting them (Correct answer)

Correct answer: Verifying that inbound goods match purchase orders and meet quality standards before accepting them

Receiving inspection checks quantity, condition, and specification of incoming goods against the PO and packing list before storage.

Question 61: What is strategic sourcing?

Automating purchase order generation
Emergency purchasing to cover stockouts
A systematic approach to supply chain management that optimizes value across the supply base (Correct answer)
Buying from the cheapest available supplier

Correct answer: A systematic approach to supply chain management that optimizes value across the supply base

Strategic sourcing analyzes organizational spending and supplier markets to develop a sourcing strategy that maximizes total value.

Question 62: A Business Continuity Plan (BCP) in supply chain management is primarily designed to:

Maximize profit margins under normal operations
Reduce warehouse overhead costs
Ensure critical supply chain functions continue during and after a major disruption (Correct answer)
Automate procurement processes

Correct answer: Ensure critical supply chain functions continue during and after a major disruption

A BCP outlines procedures to maintain or quickly restore supply chain operations when a significant disruption occurs.

Question 63: Which inventory strategy reduces risk by stocking products closest to confirmed demand?

Pull strategy (Correct answer)
Mass customization
Batch processing
Push strategy

Correct answer: Pull strategy

A pull strategy only replenishes inventory in response to actual customer demand signals, reducing overstock and waste.

Question 64: What does 'supply chain agility' mean?

The ability to rapidly respond to changes in demand, supply, or market conditions (Correct answer)
Reducing the number of supply chain tiers
The speed at which new suppliers are onboarded
Using agile software development in supply chain IT projects

Correct answer: The ability to rapidly respond to changes in demand, supply, or market conditions

Supply chain agility is the capability to quickly adjust supply levels, routes, sourcing, and processes in response to unexpected changes.

Question 65: Which inventory method assumes the first items purchased are the first items sold?

Specific Identification
FIFO (Correct answer)
Weighted Average
LIFO

Correct answer: FIFO

FIFO (First In, First Out) assumes inventory purchased earliest is sold first, commonly used for perishable goods.

Question 66: What is the purpose of a warehouse putaway process?

Moving received goods from the dock to designated storage locations (Correct answer)
Sending invoices to accounts payable
Preparing items for outbound shipment
Generating replenishment orders

Correct answer: Moving received goods from the dock to designated storage locations

Putaway directs received items to optimal warehouse locations based on product type, velocity, size, and storage rules.

Question 67: What is the primary advantage of air freight over ocean freight?

Best suited for hazardous materials
Largest cargo capacity
Lower cost per unit
Fastest transit time for international shipments (Correct answer)

Correct answer: Fastest transit time for international shipments

Air freight offers the fastest transit times globally, making it ideal for time-sensitive, high-value, or perishable goods.

Question 68: What is a freight forwarder?

A cargo insurance underwriter
A customs inspector employed by CBP
A company that owns ocean vessels
An agent that arranges international shipments on behalf of exporters and importers, handling documentation and logistics (Correct answer)

Correct answer: An agent that arranges international shipments on behalf of exporters and importers, handling documentation and logistics

A freight forwarder acts as an intermediary who books cargo space, prepares export documents, and coordinates international shipments for clients.

Question 69: What is a blanket purchase order?

An order covering multiple supplier locations
A long-term agreement to purchase items at fixed prices over a defined period (Correct answer)
An order for all items in a product category
An emergency order placed without competitive bidding

Correct answer: A long-term agreement to purchase items at fixed prices over a defined period

A blanket PO establishes pricing and terms for recurring purchases over a period, reducing the need to issue individual orders.

Question 70: What is value-added services (VAS) in warehousing?

Services like labeling, kitting, or repackaging performed on goods while in the warehouse (Correct answer)
Loyalty programs for warehouse tenants
Guaranteed next-day delivery options
Premium insurance for stored goods

Correct answer: Services like labeling, kitting, or repackaging performed on goods while in the warehouse

VAS includes activities such as product labeling, kitting, assembly, and customization performed by the warehouse before shipping.

Question 71: Which incoterm means the seller delivers goods to a named port and the buyer assumes all risk once goods are on board?

FOB (Correct answer)
CIF
DDP
EXW

Correct answer: FOB

FOB (Free On Board) transfers risk and cost from seller to buyer once the goods are loaded onto the vessel at the named port.

Question 72: What is the primary goal of early supplier involvement (ESI)?

Lock in pricing before market fluctuations
Ensure suppliers meet ISO certification requirements
Incorporate supplier knowledge into product design to improve cost and manufacturability (Correct answer)
Reduce the number of approved suppliers

Correct answer: Incorporate supplier knowledge into product design to improve cost and manufacturability

ESI brings suppliers into the product design phase to leverage their technical expertise, improving quality, cost, and time-to-market.

Question 73: What is a supply chain risk assessment?

Annual financial review of supply chain costs
A systematic process to identify, evaluate, and prioritize risks across supply chain operations (Correct answer)
Assessing warehouse fire safety compliance
Auditing supplier ISO certifications

Correct answer: A systematic process to identify, evaluate, and prioritize risks across supply chain operations

Supply chain risk assessment identifies vulnerabilities like single-source dependencies, geographic concentration, and supplier financial fragility.

Question 74: What is a bill of materials (BOM)?

A warehouse picking list
A supplier invoice list
A shipping manifest
A comprehensive list of raw materials and components needed to manufacture a product (Correct answer)

Correct answer: A comprehensive list of raw materials and components needed to manufacture a product

A bill of materials specifies all components, sub-assemblies, and quantities required to produce a finished product.

Question 75: ESG (Environmental, Social, and Governance) risk in supply chains refers primarily to:

Excess stock and goods write-offs
Electronic shelf-edge price tags
Enterprise software integration challenges
Risks arising from unsustainable practices, labor violations, or poor governance in the supply chain (Correct answer)

Correct answer: Risks arising from unsustainable practices, labor violations, or poor governance in the supply chain

ESG risk covers exposure to reputational, legal, and operational harm from suppliers engaging in environmentally harmful practices, labor abuses, or governance failures.

Question 76: A company maps all its suppliers, their suppliers, and beyond to identify hidden vulnerabilities. This practice is called:

Vendor managed inventory
Supply chain mapping (n-tier visibility) (Correct answer)
Supplier auditing
Spend analysis

Correct answer: Supply chain mapping (n-tier visibility)

N-tier supply chain mapping extends visibility beyond direct (Tier 1) suppliers to uncover risks embedded deeper in the supply chain.

Question 77: What is the three-way match process in accounts payable?

Confirming delivery with shipper, carrier, and buyer
Verifying price with three suppliers
Checking three currencies for best exchange rate
Matching a purchase order, receiving report, and supplier invoice before payment (Correct answer)

Correct answer: Matching a purchase order, receiving report, and supplier invoice before payment

Three-way matching compares the PO, goods receipt, and invoice to ensure they agree before authorizing supplier payment.

Question 78: What is the bullwhip effect in supply chains?

The delay caused by single-source suppliers
Rapid delivery acceleration at year-end
A crack in cold chain storage
Increasing demand variability amplification moving upstream through a supply chain (Correct answer)

Correct answer: Increasing demand variability amplification moving upstream through a supply chain

The bullwhip effect describes how small fluctuations in consumer demand escalate into large swings in orders placed with upstream suppliers.

Question 79: Which supply chain risk management document details the step-by-step actions teams must take when a specific risk event (e.g., port closure) occurs?

Demand forecast report
Supplier scorecard
Risk response playbook (contingency plan) (Correct answer)
Incoterms agreement

Correct answer: Risk response playbook (contingency plan)

A risk response playbook (or contingency plan) pre-defines who does what, when, and how when a specific risk scenario materializes.

Question 80: What is a customs broker?

A government customs official
A licensed professional who facilitates the import and export of goods by handling customs clearance on behalf of businesses (Correct answer)
An ocean freight carrier agent
A freight insurance underwriter

Correct answer: A licensed professional who facilitates the import and export of goods by handling customs clearance on behalf of businesses

A customs broker is a licensed agent who prepares and submits customs documentation to facilitate the clearance of imported and exported goods.

Question 81: What is a reorder point (ROP)?

The quantity of goods returned per cycle
The inventory level at which a new order should be placed (Correct answer)
The maximum inventory level allowed
The minimum safety stock threshold

Correct answer: The inventory level at which a new order should be placed

The reorder point is the inventory level that triggers a new purchase order, calculated using lead time and average demand.

Question 82: What is a country of origin determination?

Identifying where a product's trademark is registered
Determining which currency to use on an invoice
Establishing the country where a product was manufactured or substantially transformed for customs and trade purposes (Correct answer)
Verifying where a supplier is headquartered

Correct answer: Establishing the country where a product was manufactured or substantially transformed for customs and trade purposes

Country of origin determines which tariff rates, trade agreements, and import restrictions apply to a specific product entering a country.

Question 83: Which sourcing strategy involves working closely with a small number of preferred suppliers?

Reverse auction
Open tendering
Sole sourcing
Preferred supplier program (Correct answer)

Correct answer: Preferred supplier program

A preferred supplier program qualifies a limited set of vendors and concentrates volume with them in exchange for better pricing and service.

Question 84: What is order wave picking?

Picking the highest-priority order first
Sorting outbound orders by shipping carrier
Releasing and picking multiple orders simultaneously in coordinated batches (Correct answer)
Picking one order at a time start to finish

Correct answer: Releasing and picking multiple orders simultaneously in coordinated batches

Wave picking groups orders into batches (waves) released at scheduled intervals to coordinate picking, packing, and shipping for carrier cut-offs.

Question 85: What is deadhead mileage in trucking?

Miles a truck travels empty without a paying load (Correct answer)
Total route distance including stops
Distance from shipper to first delivery point
Miles driven with a full load

Correct answer: Miles a truck travels empty without a paying load

Deadhead miles are unprofitable empty miles a driver travels after delivering a load and before picking up the next one.

Question 86: What does 'drayage' refer to in intermodal shipping?

Bonded warehouse storage
Long-haul ocean transit
Air cargo handling fee
Short-distance truck transport of containers between port and rail ramp (Correct answer)

Correct answer: Short-distance truck transport of containers between port and rail ramp

Drayage is the short-haul truck movement of shipping containers, typically between a port, rail terminal, and nearby warehouse.

Question 87: What is cargo insurance and why is it important in international shipping?

Health insurance for longshoremen
Insurance that protects the financial value of goods in transit against loss, damage, or theft (Correct answer)
Coverage for carrier bankruptcy during shipment
Liability coverage for warehouse employees

Correct answer: Insurance that protects the financial value of goods in transit against loss, damage, or theft

Cargo insurance covers the commercial value of goods against physical loss or damage occurring during international or domestic transport.

Question 88: What is the Importer Security Filing (ISF) requirement?

A security deposit held by CBP for high-risk importers
A post-arrival customs audit report
A US CBP requirement for importers to file advance cargo data at least 24 hours before vessel departure for US-bound ocean shipments (Correct answer)
Annual import compliance certification

Correct answer: A US CBP requirement for importers to file advance cargo data at least 24 hours before vessel departure for US-bound ocean shipments

ISF (also called '10+2') requires importers to electronically submit 10 data elements to CBP 24 hours before cargo is loaded on a US-bound vessel.

Question 89: In a two-bin inventory system, what triggers a new order?

When the second bin starts being used (Correct answer)
When weekly count reveals shortage
When the first bin is empty
When both bins are full

Correct answer: When the second bin starts being used

In a two-bin system, consumption from the second bin signals that a replenishment order should be placed to refill both bins.

Question 90: What is cycle counting?

Counting all inventory at fiscal year end
Auditing freight invoices monthly
Counting a rotating subset of inventory items on a regular schedule (Correct answer)
Tracking order cycles from supplier

Correct answer: Counting a rotating subset of inventory items on a regular schedule

Cycle counting replaces full physical inventory counts by regularly auditing small portions of inventory throughout the year.

Question 91: What is a 3D racking or high-bay warehouse system designed to maximize?

Vertical storage density by using tall rack structures up to 100+ feet (Correct answer)
Temperature control for cold chain
Security and access control
Floor space utilization

Correct answer: Vertical storage density by using tall rack structures up to 100+ feet

High-bay warehouses use automated storage and retrieval systems (AS/RS) to exploit vertical height, dramatically increasing storage density per square foot.

Question 92: What is the difference between a push and pull supply chain strategy?

Push uses rail; pull uses road transport
Push applies to B2B; pull applies to B2C
Push uses domestic suppliers; pull uses global suppliers
Push produces based on forecasts; pull produces based on actual demand signals (Correct answer)

Correct answer: Push produces based on forecasts; pull produces based on actual demand signals

Push strategies build and distribute inventory based on demand forecasts, while pull strategies respond to real customer orders or consumption signals.

Question 93: Which metric measures the time required for a supply chain to return to normal performance after a disruption?

Time-to-recover (TTR) (Correct answer)
Perfect order rate
Fill rate
Cash-to-cash cycle time

Correct answer: Time-to-recover (TTR)

Time-to-recover (TTR) quantifies how long it takes for supply chain performance to fully bounce back after a disruptive event.

Question 94: What does a freight broker do in the transportation industry?

Provides cargo insurance
Acts as an intermediary connecting shippers with carriers (Correct answer)
Owns and operates trucking fleets
Manages customs clearance documentation

Correct answer: Acts as an intermediary connecting shippers with carriers

A freight broker matches shippers who need to move cargo with carriers that have available capacity, earning a commission.

Question 95: A supply chain resilience strategy that uses multiple geographically dispersed suppliers for the same component is known as:

Dual/multi-sourcing (Correct answer)
Sole sourcing
Cross-docking
Consignment stocking

Correct answer: Dual/multi-sourcing

Dual or multi-sourcing spreads procurement across several suppliers in different regions, reducing reliance on any one source and geographic concentration risk.

Question 96: What is the purpose of a Request for Quotation (RFQ)?

Request pricing from suppliers for a defined quantity of specified goods or services (Correct answer)
Describe project requirements to attract vendor interest
Evaluate supplier financial stability
Negotiate payment terms with existing suppliers

Correct answer: Request pricing from suppliers for a defined quantity of specified goods or services

An RFQ asks suppliers to provide specific pricing for clearly defined products or services, enabling direct price comparison.

Question 97: What is the purpose of zone picking in a warehouse?

Separate hazardous materials by type
Designate areas by temperature requirement
Organize returns by supplier zone
Assign pickers to specific zones to reduce travel time and increase efficiency (Correct answer)

Correct answer: Assign pickers to specific zones to reduce travel time and increase efficiency

Zone picking divides the warehouse into sections, with each picker responsible for their zone, reducing congestion and travel distance.

Question 98: What is a forklift operator certification requirement in the US?

OSHA-required training covering safety, operation, and workplace-specific hazards (Correct answer)
Valid CDL license
State-issued warehouse license
Federal Motor Carrier Safety Administration registration

Correct answer: OSHA-required training covering safety, operation, and workplace-specific hazards

OSHA 29 CFR 1910.178 requires employers to train and certify all forklift operators before they operate powered industrial trucks.

Question 99: What is a supplier scorecard?

A financial audit report
A list of approved vendor contacts
A structured tool for evaluating supplier performance across key metrics (Correct answer)
A checklist for new vendor onboarding

Correct answer: A structured tool for evaluating supplier performance across key metrics

A supplier scorecard tracks KPIs like on-time delivery, quality, responsiveness, and cost to provide objective performance ratings.

Question 100: What is the carrying cost of inventory?

Total cost of holding inventory over a period (Correct answer)
Purchase price of raw materials
Cost to ship goods to customers
Cost to process a purchase order

Correct answer: Total cost of holding inventory over a period

Carrying cost includes storage, insurance, obsolescence, taxes, and capital opportunity costs associated with holding inventory.

Question 101: What is an integrated supply chain?

A supply chain where all processes, information, and partners are coordinated seamlessly from raw material to end customer (Correct answer)
A supply chain that uses integrated logistics software
A supply chain managed by a single company end-to-end
A supply chain using only domestic suppliers

Correct answer: A supply chain where all processes, information, and partners are coordinated seamlessly from raw material to end customer

An integrated supply chain aligns all participants—suppliers, manufacturers, distributors, and retailers—through shared information and coordinated processes.

Question 102: What is the difference between strategic, tactical, and operational supply chain planning?

Strategic involves customers, tactical involves suppliers, operational involves carriers
Strategic is daily, tactical is weekly, operational is annual
Strategic covers long-term network design, tactical covers mid-term capacity, operational covers day-to-day execution (Correct answer)
Strategic is for procurement, tactical for logistics, operational for warehousing

Correct answer: Strategic covers long-term network design, tactical covers mid-term capacity, operational covers day-to-day execution

Supply chain planning operates across three horizons: strategic (network design, years), tactical (capacity and sourcing, months), and operational (scheduling and execution, days).

Question 103: What does 'maverick spending' mean in procurement?

Innovative sourcing strategies
Unauthorized purchases made outside approved procurement processes (Correct answer)
Purchasing from international suppliers
Exceeding the annual budget

Correct answer: Unauthorized purchases made outside approved procurement processes

Maverick spending occurs when employees bypass procurement policies and approved suppliers, reducing negotiating leverage and compliance.

Question 104: What is supplier segmentation?

Dividing a supplier's product catalog into categories
Splitting orders across multiple suppliers equally
Classifying suppliers based on strategic importance and risk to prioritize management effort (Correct answer)
Grouping suppliers by geographic region

Correct answer: Classifying suppliers based on strategic importance and risk to prioritize management effort

Supplier segmentation categorizes vendors into tiers (strategic, preferred, transactional) to allocate appropriate relationship and management resources.

Question 105: What is slotting in warehouse management?

Strategically assigning product storage locations to optimize pick efficiency (Correct answer)
Allocating labor shifts per zone
Sorting returned items by condition
Scheduling receiving dock appointments

Correct answer: Strategically assigning product storage locations to optimize pick efficiency

Slotting optimization places high-velocity items closest to shipping areas and at ergonomic heights to minimize travel time and labor cost.

Question 106: What is a WMS in warehouse management?

Weekly Material Summary
Worker Management Schedule
Warehouse Management System (Correct answer)
Wholesale Markup Standard

Correct answer: Warehouse Management System

A Warehouse Management System (WMS) is software that controls and optimizes warehouse operations from receiving to shipping.

Question 107: Which international standard provides guidance for implementing an organizational risk management framework, commonly applied to supply chain risk?

ISO 14001
ISO 31000 (Correct answer)
ISO 28000
ISO 9001

Correct answer: ISO 31000

ISO 31000 provides principles and guidelines for risk management applicable across all types of organizations and industries, including supply chain risk.

Question 108: What is postponement strategy in supply chain management?

Pushing inventory upstream to reduce distribution costs
Postponing new product launches until peak season
Delaying supplier payments to improve cash flow
Deferring product differentiation to the latest possible point in the supply chain (Correct answer)

Correct answer: Deferring product differentiation to the latest possible point in the supply chain

Postponement delays customization or final assembly until actual demand is known, reducing forecast risk and inventory obsolescence.

Question 109: What does RFID technology enable in warehouse management?

Automated invoice generation
Real-time tracking of items without line-of-sight scanning (Correct answer)
Video surveillance of warehouse aisles
Remote temperature monitoring

Correct answer: Real-time tracking of items without line-of-sight scanning

RFID (Radio Frequency Identification) tags transmit data wirelessly, enabling bulk scanning and real-time inventory tracking without manual barcode scanning.

Question 110: What is a 3PL in logistics?

Triple Procurement License
Tri-Port Loading system
Three-Phase Logistics plan
Third-Party Logistics provider (Correct answer)

Correct answer: Third-Party Logistics provider

A 3PL (Third-Party Logistics) provider offers outsourced logistics services including warehousing, transportation, and fulfillment.

Question 111: What does EOQ stand for in inventory management?

Expected Order Quality
Estimated Order Queue
Economic Order Quantity (Correct answer)
Efficient Output Quota

Correct answer: Economic Order Quantity

EOQ (Economic Order Quantity) is the ideal order quantity that minimizes total inventory holding and ordering costs.

Question 112: What is a digital twin in supply chain management?

Two identical supply chains run in parallel
A backup ERP system for disaster recovery
A cloud-based supplier portal
A virtual replica of the supply chain used for simulation, scenario planning, and optimization (Correct answer)

Correct answer: A virtual replica of the supply chain used for simulation, scenario planning, and optimization

A supply chain digital twin creates a real-time virtual model that mirrors physical operations, enabling what-if analysis and risk simulation.

Question 113: What is safety stock used for in inventory management?

Improve supplier relationships
Reduce ordering frequency
Lower purchase price
Buffer against demand variability and supply delays (Correct answer)

Correct answer: Buffer against demand variability and supply delays

Safety stock is extra inventory held to protect against unexpected spikes in demand or delays in replenishment.

Question 114: What is cross-docking?

Storing goods on double-sided shelving
Moving inventory between warehouse locations
Transferring inbound shipments directly to outbound transport with minimal storage (Correct answer)
Using two loading docks simultaneously

Correct answer: Transferring inbound shipments directly to outbound transport with minimal storage

Cross-docking transfers products from incoming trucks directly to outbound vehicles, bypassing traditional warehousing to reduce handling and storage.

Question 115: What is a reverse auction in procurement?

Inventory is auctioned in reverse order
Buyer sells surplus assets to suppliers
Buyer auctions purchase rights to the highest bidder
Suppliers compete by submitting progressively lower bids for a buyer's contract (Correct answer)

Correct answer: Suppliers compete by submitting progressively lower bids for a buyer's contract

In a reverse auction, multiple suppliers bid against each other in real time, driving down the price a buyer pays for goods or services.

Question 116: What does the term 'shrinkage' refer to in retail inventory?

Product size reduction
Decrease in supplier lead time
Inventory loss due to theft, damage, or administrative error (Correct answer)
Seasonal decline in sales

Correct answer: Inventory loss due to theft, damage, or administrative error

Shrinkage is the difference between recorded inventory and actual physical inventory, caused by theft, spoilage, or counting errors.

Question 117: What is a demurrage charge in shipping?

Penalty assessed when a shipper holds a container beyond the free period at a port or terminal (Correct answer)
Fee for early delivery of containers
Cost of repackaging damaged goods
Surcharge for oversized cargo

Correct answer: Penalty assessed when a shipper holds a container beyond the free period at a port or terminal

Demurrage is charged when cargo or containers remain at a terminal beyond the allotted free time, incentivizing rapid container turnover.

Question 118: What is the SCOR model used for in supply chain management?

Calculating carbon emissions from logistics
A reference framework for analyzing and improving supply chain performance across plan, source, make, deliver, return, and enable processes (Correct answer)
Measuring warehouse labor productivity
Benchmarking employee training effectiveness

Correct answer: A reference framework for analyzing and improving supply chain performance across plan, source, make, deliver, return, and enable processes

The Supply Chain Operations Reference (SCOR) model provides a standardized framework for evaluating and improving supply chain processes and metrics.

Question 119: What does the US Customs drawback program allow importers to do?

Delay duty payment by 90 days
Reduce assessed duties through a tariff classification appeal
Recover duties paid on imported goods that are subsequently exported or used in exported products (Correct answer)
Import goods duty-free under a blanket order

Correct answer: Recover duties paid on imported goods that are subsequently exported or used in exported products

Customs drawback allows businesses to claim refunds of up to 99% of duties paid on imported materials that are later exported.

Question 120: What is the formula for Days Inventory Outstanding (DIO)?

COGS / Average Inventory
Net Income / Total Assets
Revenue / Average Inventory
(Average Inventory / COGS) × 365 (Correct answer)

Correct answer: (Average Inventory / COGS) × 365

DIO measures how many days on average a company holds inventory before selling it, calculated as (Average Inventory / COGS) × 365.

Question 121: Which transportation mode typically offers the lowest cost per ton-mile for bulk goods over long distances?

Air freight
Trucking
Courier service
Rail freight (Correct answer)

Correct answer: Rail freight

Rail freight has the lowest cost per ton-mile for bulk commodities over long distances due to fuel efficiency and large load capacity.

Question 122: Which supply chain risk management approach involves identifying critical nodes whose failure would most severely disrupt the entire network?

FIFO inventory rotation
ABC analysis
Vendor scorecard review
Critical path and node analysis (Correct answer)

Correct answer: Critical path and node analysis

Critical node analysis identifies the suppliers, facilities, or routes whose failure would cause the greatest disruption, so mitigation efforts can be prioritized there.

Question 123: What is the C-TPAT program?

Commercial Transport Passenger and Freight Tax
Customs Tariff Processing and Trading system
Customs-Trade Partnership Against Terrorism — a US CBP supply chain security program (Correct answer)
Container Tracking and Port Access Terminal

Correct answer: Customs-Trade Partnership Against Terrorism — a US CBP supply chain security program

C-TPAT is a voluntary US CBP partnership program where businesses adopt supply chain security standards in exchange for expedited customs processing.

Question 124: What is export controls compliance?

Controlling the quality of exported products
Managing outbound freight costs
Verifying that exported containers are properly sealed
Ensuring that exports of controlled goods, technology, and information comply with US government regulations (Correct answer)

Correct answer: Ensuring that exports of controlled goods, technology, and information comply with US government regulations

Export controls regulate the transfer of dual-use goods, military items, and sensitive technologies to foreign countries or nationals.

Question 125: What is a supply chain disruption?

A seasonal demand surge
A planned maintenance shutdown
An unexpected event that interrupts the normal flow of goods, information, or finances in a supply chain (Correct answer)
A technology upgrade to supply chain software

Correct answer: An unexpected event that interrupts the normal flow of goods, information, or finances in a supply chain

Supply chain disruptions—caused by natural disasters, geopolitical events, supplier failures, or pandemics—interrupt product flow and require contingency responses.

Question 126: When a company transfers supply chain risk to an insurer by purchasing cargo or business interruption insurance, this is an example of:

Risk reduction
Risk transfer (Correct answer)
Risk acceptance
Risk avoidance

Correct answer: Risk transfer

Risk transfer shifts the financial burden of a potential loss to a third party (such as an insurer) rather than bearing it internally.

Question 127: Which inventory system continuously tracks stock levels and triggers orders when needed?

Continuous review system (Correct answer)
Vendor-managed inventory
Just-in-time system
Periodic review system

Correct answer: Continuous review system

A continuous review (Q) system monitors inventory in real time and places orders whenever stock falls to the reorder point.

Question 128: What does AMS stand for in US import operations?

Annual Module Summary
Advanced Maritime Schedule
Automated Manifest System (Correct answer)
Automated Merchandise System

Correct answer: Automated Manifest System

The Automated Manifest System (AMS) requires carriers to transmit cargo manifest data to US Customs before vessel arrival.

Question 129: What is an importer of record (IOR)?

The shipping carrier named on the bill of lading
The customs broker filing the entry
The entity legally responsible for ensuring compliance with import regulations and paying applicable duties (Correct answer)
The company that physically receives imported goods

Correct answer: The entity legally responsible for ensuring compliance with import regulations and paying applicable duties

The importer of record is legally responsible for the accuracy of import documents, payment of duties, and compliance with all import regulations.

APICS CLTD – Certified in Logistics, Transportation and Distribution

The APICS CLTD certification validates expertise in logistics, transportation, and distribution including logistics strategy, inventory management, warehouse operations, transportation, and global logistics. It is administered by ASCM (Association for Supply Chain Management) and is recognized worldwide as a benchmark for logistics professionals.

150

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210 min

Time Limit

70%

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